California Reaps $259.7M in Cannabis Tax Revenue for Q2 2025

LOS ANGELES – California’s legal Cannabis sector delivered $259.7 million in tax revenue during the second quarter of 2025, based on data released by the California Department of Tax and Fee Administration (CDTFA). The figure includes $147.3 million from the state’s 15% excise tax on Cannabis products and $112.4 million from sales and use taxes.

This marks a dip from the same period in 2024, when total revenue reached $272.8 million, split between $160.9 million in excise taxes and $111.9 million in sales taxes. The decline reflects broader trends in the industry, with excise collections down by about 8% YOY. For H1 2025, combined revenue hit $502.8 million, incorporating a revised $243.1 million from the first quarter ($142.4 million excise and $100.7 million sales).

The excise tax, which applies at the point of retail sale, funds a range of public initiatives, including childcare services, youth substance abuse prevention, medical research, and environmental restoration efforts tied to past illegal cultivation sites. Since the launch of regulated sales in January 2018, California has amassed more than $7.3 billion in Cannabis-related taxes, with excise contributions totaling $3.9 billion and sales taxes adding $2.9 billion.

A review of quarterly data shows variability in revenue streams:

These numbers highlight a stabilization below the high-water mark set in 2021, following the elimination of the cultivation tax in mid-2022, which aimed to reduce costs for growers and retailers. While quarterly totals have not returned to those levels, the consistent flow of funds demonstrates the sector’s enduring fiscal impact.