Arizona Hits Recreational Marijuana Sales Record, With New Program Catching Up To Medical

Medical cannabis sales eclipsed recreational from February through October—adult-use sales began on January 22—but in November, those numbers were almost identical.

By David Abbott, Arizona Mirror

Arizona cannabis sales continued on an upward trajectory in 2021, with the Arizona Department of Revenue reporting more than $1.23 billion in combined cannabis sales through the first 11 months of the year.

In November, adult-use recreational cannabis sales hit a new peak and crossed $60 million for the first time. Medical sales have fluctuated throughout the year, topping out at about $73 million in March and April.

Medical sales eclipsed recreational from February through October—adult-use sales began on January 22—but in November, those numbers were almost identical, with the medical program bringing in an estimated $60,365,545, while recreational sales reached $60,299,191.

In October, estimated cannabis sales for both programs were within $7 million of each other, the first time recreational sales came within $10 million of medical sales. But the adult-use market is in its infancy and is expected to match the medical program’s economic heft within a few years.

Cannabis sales also provided a solid tax contribution in 2021.

TAXABLE Sales (Estimated) to date
PERIOD COVERED ADULT USE‐420 MEDICAL‐ 203 EXCISE TAX
Jan‐21 $7,370,460 $42,140,608 $11,391,371
Feb‐21 $32,697,512 $55,320,625 $39,246,992
Mar‐21 $51,628,266 $72,934,129 $55,808,898
Apr‐21 $54,037,990 $72,944,477 $58,954,469
May‐21 $52,843,171 $70,158,567 $59,372,157
Jun‐21 $50,943,017 $64,854,708 $56,749,799
Jul‐21 $54,324,542 $70,880,576 $58,740,337
Aug-21 $51,877,656 $65,492,643 $57,675,654
Sep-21 $52,450,298 $62,704,561 $57,663,164
Oct-21 $59,508,253 $65,415,461 $62,446,719
Nov-21 $60,299,191 $60,365,545 $63,187,702
Dec-21 $20,922 $591,294 $0
$528,001,278 $703,803,194 $581,237,261

The state collects 16 percent excise tax on recreational sales in addition to the standard sales tax; medical patients pay a 6 percent excise tax. Local jurisdictions charge an additional 2 percent or so for all marijuana sales.

Taxes collected in November for recreational cannabis sales were $5,055,950, with medical slightly less at $5,026,317. The excise tax reached $10,110,032 for a total of $20,192,299 in tax revenue from November marijuana sales.

Proposition 207, which voters approved in 2020 to legalize adult use of cannabis, included specific uses for taxes collected on the recreational side. One-third is dedicated to community college and provisional community college districts; 31 percent to public safety—police, fire departments, fire districts, first responders—25 percent to the Arizona Highway User Revenue Fund and 10 percent to the justice reinvestment fund, dedicated to providing public health services, counseling, job training and other social services for communities that have been adversely affected and disproportionately impacted by marijuana arrests and criminalization.

The state collected a total of $196,447,570 in tax revenue the first 11 months of 2021 from cannabis sales, with $44,533,436 from recreational, $58,916,172 from medical and $92,997,962 from the excise tax.

This story was first published by Arizona Mirror.

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