Recreational Cannabis Sales in Ohio Continue to Surge Six Months After Legalization

In November 2023, Ohio became the 24th state to legalize adult-use cannabis. By August 2024, dispensaries across the state began selling recreational marijuana, and now, six months later, sales remain strong.

Ohio’s Recreational Cannabis Industry Flourishes as Dispensaries Report High Sales

According to Jana Hrdinova, administrative director at Ohio State University’s Drug Enforcement and Policy Center, recreational marijuana sales are steadily climbing. The 123 dispensaries operating across the state have collectively sold more than $255 million worth of adult-use cannabis.

Despite the impressive revenue figures, not all dispensaries are fully operational yet. As more establishments open, sales figures could increase even further, solidifying Ohio’s place in the growing national cannabis market.

Tax Revenue From Recreational Cannabis Sales Could Bring Ohio Up to $115 Million

The booming marijuana industry is generating substantial tax revenue for the state. Ohio applies a 5.75% state sales tax along with a 10% marijuana-specific excise tax on cannabis products. This has already resulted in approximately $40 million in tax revenue.

Hrdinova estimates that if current demand continues, the state could see anywhere from $90 million to $115 million in tax revenue from marijuana sales by the end of the year.

Understanding Where Recreational Cannabis Tax Revenue Is Allocated

While revenue from standard sales taxes enters Ohio’s general fund, the marijuana-specific excise tax is earmarked for specific initiatives. These include:

Local Communities (36%): A significant portion of the excise tax is directed to the communities hosting dispensaries, incentivizing local governments to permit cannabis sales.

Cannabis Social Equity Fund and Jobs Program (36%): This program supports research on criminal justice reform and promotes diversity and inclusion in the cannabis industry.

Substance Abuse and Addiction Fund (25%): A quarter of the funds are allocated to addiction services, research, and education.

Regulatory Oversight (3%): The remaining funds go to the Division of Cannabis Control and Tax Commissioner Fund, responsible for overseeing marijuana regulations in the state.

Ohio Towns and Cities Weigh Cannabis Moratoriums Despite Statewide Legalization

Although Ohio voters passed the constitutional amendment legalizing recreational marijuana, some local governments are choosing to limit or ban its sale within their jurisdictions. By the end of 2024, 124 Ohio municipalities—approximately 5% of the state’s local governments—had enacted temporary bans on marijuana sales.

Compared to other states, this is a relatively low number. In Michigan, for example, 75% of municipalities have banned dispensaries, while in New York, around 50% have implemented some form of restriction.

Ohio Lawmakers Consider Changes to Cannabis Regulations and Taxation Policies

As Ohio’s recreational marijuana industry grows, state lawmakers are considering modifications to existing regulations. Potential changes include:

Public Use Restrictions: Proposals aim to regulate where marijuana can be consumed in public spaces.

Home Cultivation Limits: Lawmakers are discussing restrictions on the number of plants adults can grow at home.

THC Concentration Controls: Potential policies may set limits on the potency of cannabis products.

One of the most significant proposed changes involves increasing the marijuana excise tax from 10% to 15%. If enacted, this would place Ohio among the highest-taxed states for cannabis, ranking fourth in the nation.

Additionally, the latest legislative proposals suggest redirecting all marijuana-related tax revenue to Ohio’s General Revenue Fund rather than allocating it to specific initiatives as originally planned.

As Ohio’s cannabis industry continues to evolve, the impact of these policy discussions will shape the future of legal cannabis in the state. With strong initial sales and growing consumer interest, Ohio remains on track to become a major player in the national cannabis market.