Wisconsin loses millions in marijuana tax revenue to border states

WISCONSIN (WBAY) – Wisconsin residents contributed more than $36 million in marijuana taxes to Illinois last year and nearly $6 million to Michigan in 2024, according to new numbers released by the state Legislative Fiscal Bureau.

The revenue comes from counties bordering Wisconsin that legally sell marijuana, while bills to legalize both medical and recreational marijuana remain stalled in the Wisconsin Legislature.

Wisconsin will have a new governor, new speaker in the Assembly and a new majority leader in the state Senate next January.

All three people holding those leadership positions decided not to seek re-election.

State lawmakers will have a fresh debate regarding marijuana for the first time in a while, and the latest numbers from the Legislative Fiscal Bureau are likely to be a big part of it.

Illinois dispensaries generate millions from Wisconsin buyers

On the Wisconsin border, from Michigan to Illinois, marijuana sales have become big business.

“The economic value to restoring this plant back to our economy is huge. We can’t even put a dollar amount on it,” said Jay Selthofner, founder of the Wisconsin Cannabis Activist Network.

According to the Legislative Fiscal Bureau memo, Wisconsin residents contributed $36.1 million last year to the overall marijuana tax collected by Illinois.

That’s based on data from 36 dispensaries located in five of the six counties bordering Wisconsin. Jo Daviess, Lake, McHenry, Winnebago and Boone counties have dispensaries, while Stephenson County does not.

Among the five counties with dispensaries, a total of $319.4 million in sales was generated. The report concludes $132.4 million, or 41.5%, of these sales were made to out-of-state residents.

“It’s concerning that yeah, revenue is leaving the state both tax wise and tourism dollars without being a state that is looked at as recreational marijuana, we’re losing some tourism there,” Selthofner said.

Michigan collects nearly $6 million in taxes from Wisconsin residents

On the other side of the state, Michigan is making money off Wisconsin residents.

The most recent data from 2024 shows the state with 854 retailers and microbusinesses licensed to sell cannabis. Of those licensees, 22 were located in counties bordering Wisconsin: Gogebic, Iron, Dickinson and Menominee.

The report states, “Assuming that each retailer/microbusiness makes an equal amount of sales,” those businesses in the Upper Peninsula brought in $85.4 million. Using the same estimate as Illinois, 41.5% of sales came from Wisconsin residents, translating into $5.8 million in tax revenue collected.

Minnesota is also mentioned in the report. The state began legalized cannabis sales in September 2025, but so far there is no data on taxes paid by Wisconsin residents.

Gubernatorial candidates weigh in on legalization

If Wisconsin makes changes, it’s likely to be next year after the November election.

Republican candidate for governor Tom Tiffany said he is open to medical marijuana and supporting veterans.

“I think in particular we should look out for our veterans. I’ve heard from so many veterans that suffer from PTSD and I’m very open to that as well as medicinal. I think we just work our way through it and get to a good spot in regards to marijuana,” Tiffany said.

Among the Democrats running for governor, at least seven have come out supporting efforts to legalize marijuana, aligning with the state party platform.

“A lot of people look at it as the wild west right now here in Wisconsin, it’s not. It’s the wild Wisconsin and what Wisconsin is going to do is it’s going to show the rest of the country how innovative a state can really be on cannabis,” Selthofner said.

Twenty-four states, along with the District of Columbia, legalize recreational marijuana, and 40 total legalize medical marijuana. The most recent additions are Ohio, Minnesota and Missouri.