Pennsylvania stands to generate $271 million in annual revenue if marijuana is legalized and taxed according to the governor’s proposal—but it would have been more if the commonwealth hadn’t been lapped by other neighboring states that have already enacted the reform, according to a new government economic analysis.
The Pennsylvania Independent Fiscal Office (IFO) released its report on Gov. Josh Shapiro’s (D) budget plan last week, detailing the economic impact of adult-use cannabis legalization under his proposal.
Between the 20 percent excise tax on wholesale marijuana and the state sales tax, Pennsylvania would bring in an estimated $41 million during the first year of implementation, including taking into account added expenses such as implementation costs and funding restorative justice efforts, IFO said. That would rise to an annual net $271 million gain for the state general fund by Fiscal Year 2028-2029.
That first-year estimate is significantly higher than what the governor projected ($14.8 million) when he unveiled his budget in February. Shapiro did say it could grow to about $250 million in annual revenue, though, which is more consistent with IFO’s analysis.
However, the figure could have been bigger if Pennsylvania wasn’t so late in the game on legalization in
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