New data published by the Cannabis Control Commission for 2021 has confirmed that, for the first time ever, Massachusetts’ recreational cannabis program pulled in more excise taxes than the alcohol industry.

Massachusetts accumulated $74.2 million in cannabis excise tax through December 2021 from a whopping $2.54 billion in sales. Comparatively, alcohol excise taxes generated $51.3 million.

According to the first senior Wall Street analyst specializing in coverage for the cannabis sector, Vivien Azer, the shift from medical to recreational legalization usually triggers a significant boost in revenues “almost overnight.”

Azer, who is the managing director for Cowen and Company, attributes the rise in Massachusetts’ adult-use cannabis sales excise tax revenue to the fact that people had more disposable income amid the pandemic and that lockdowns may have swayed consumer behavior.

However, Azer believes that buying trends have gradually returned to normal.

Massachusetts generated over $112 million in adult-use cannabis sales excise tax revenue last year

The year 2021 was certainly a successful one in regards to the adult-use cannabis sales excise tax revenue earned through Massachusetts’ market. In fact, the CCC affirms that the $112 million recorded was 206 percent more than what was initially estimated.

The 10.75 percent excise tax imposed on recreational cannabis is included in the total tax revenue. Plus, a 6.25 percent state sales tax and a local tax not exceeding three percent is included. 

In total, these additional charges amounted to $208 million in total tax revenue for the last fiscal year.

“This number also underscores the entire agency’s tireless efforts, particularly those of our hardworking staff, to thoughtfully regulate a safe, accessible, and effective adult-use marketplace that keeps critical tenets of our mission – public health, public safety, and equity, among others – front of mind,” said Commission Executive Director Shawn Collins in a statement that was published on January 25.

Alcohol sales have dwindled across U.S. since cannabis legalization

Data gathered in a Gallup poll revealed that alcohol sales revenue across the U.S..has consistently tumbled since the cannabis reform movement has spread over the last two decades. 

However, due to boredom-inflicting lockdown measures, alcohol sales saw a temporary uptick amid the coronavirus outbreak.

Alcohol taxes in Massachusetts may also be raised soon, with State Representative Kay Khan recently submitting a proposal (H 2973) to double the excise taxes imposed on beer, wine and liquor.

Every single year, the state forks.out $2.6 billion to help tackle alcoholism and addiction. Fortunately, cannabis reform is helping sway consumer behavior. So much so, that sales revenue transcended $2 billion in September 2021.