Phoenix, Arizona Cannabis Tax Rate
26.4% totalAdministering agencies: Arizona Department of Revenue + Phoenix Finance Department · Updated for 2026
A legal cannabis purchase in Phoenix is taxed at a combined effective rate of about 26.4%, driven by a 2.3% Phoenix cannabis business tax stacked on top of Arizona's 16% state excise and 5.6% state sales tax. That makes Phoenix the 2nd-highest-taxed of the 5 major Arizona cities tracked here — versus about 26.7% in Tucson. On a typical $100.00 dispensary purchase that works out to roughly $26.40 in tax, or about $126.40 out the door.
Phoenix is Arizona’s capital and largest city; Arizona layers local transaction privilege tax (TPT) on top of the 16% state cannabis excise.
How Much Is Cannabis Tax in Phoenix?
Use these worked examples to see what Phoenix's 26.4% combined cannabis tax adds to a dispensary purchase. Figures apply the Arizona state excise, 5.6% state sales tax, typical local sales tax, and the 2.3% Phoenix cannabis business tax to the pre-tax price.
| Pre-tax price | Total tax | Phoenix city tax | You pay |
|---|---|---|---|
| $50.00 | $13.20 | $1.15 | $63.20 |
| $100.00 | $26.40 | $2.30 | $126.40 |
| $200.00 | $52.80 | $4.60 | $252.80 |
Estimates treat all taxes as applied to the retail price; actual receipts vary by product, potency tax (where applicable), and exact local sales rate. Model a specific basket with the Phoenix tax calculator.
Phoenix Cannabis Tax Breakdown
| Tax | Rate | Notes |
|---|---|---|
| Arizona Cannabis Excise | 16% | State-imposed retail excise |
| Arizona State Sales Tax | 5.6% | Applies to medical and adult-use sales |
| Typical Local Sales Tax | 2.5% | County / district average |
| Phoenix Cannabis Business Tax | 2.3% | City-specific cannabis ordinance |
| Combined Effective Rate | 26.4% | What you actually pay at retail |
Official source: Arizona Department of Revenue ↗ · rates compiled 2026-08-11 · city rates set by local ordinance.
How Medical Cannabis Is Taxed in Phoenix
Medical patients skip the 16% excise and pay only the state/local transaction privilege (sales) tax. In practice that trims roughly $16.00 off every $100.00 spent versus an adult-use purchase in Phoenix, though the 2.3% Phoenix cannabis business tax may still apply depending on the local ordinance.
Why Is Cannabis Taxed This Much in Phoenix?
Cannabis in Phoenix carries layers of tax that ordinary retail goods never see. Arizona adds its 16% cannabis excise on top of ordinary sales tax, and Phoenix then collects an additional 2.3% cannabis business tax on licensed retailers — a cost dispensaries pass through to the customer. That stacking is why the register total at a Phoenix dispensary can run noticeably higher than the same product in a lower-tax Arizona city or across the state line.
16% cannabis excise on adult-use retail + state + local TPT (sales) tax. Medical patients pay only the state/local TPT (no 16% excise).
Phoenix vs Other Arizona Cities
Local cannabis taxes vary city to city in Arizona. Here is how Phoenix stacks up against the other major markets we track, ranked from highest to lowest combined effective rate:
| City | City Cannabis Tax | Combined Effective Rate |
|---|---|---|
| Tucson | 2.6% | 26.7% |
| Phoenix (this page) | 2.3% | 26.4% |
| Mesa | 2% | 26.1% |
| Scottsdale | 1.75% | 25.85% |
| Chandler | 1.5% | 25.6% |
See the full Arizona cannabis tax guide →
Frequently Asked Questions
What is the cannabis tax rate in Phoenix, Arizona?
How much tax will I pay on a $100 cannabis purchase in Phoenix?
How much is the cannabis business tax in Phoenix?
Is cannabis cheaper in another Arizona city near Phoenix?
Are medical cannabis patients exempt from Phoenix's tax?
Where can I buy cannabis in Phoenix?
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