NJ charges a 6.625 percent sales tax on recreational weed, up to 2 percent local tax depending on the town, and a hidden cultivation fee that can raise prices even more. Medical marijuana is tax-free and can help patients avoid these extra costs entirely.
- Recreational weed is taxed multiple ways: A 6.625 percent state sales tax is standard. Most towns add up to 2 percent more. And behind the scenes, growers pay a Social Equity Excise Fee based on product weight, which gets baked into retail prices.
- Medical cannabis is tax-free in New Jersey: Since July 2022, medical patients pay no state sales tax and are not affected by cultivation fees.
- The Social Equity Excise Fee is growing fast: This fee started at $1.10 per ounce and is now $2.50 per ounce in 2025. Lawmakers are considering increasing it even more.
- The tax money is not always spent the way it should be: Over $6 million collected from the SEEF sits unused, and the state legislature controls how and when that money is distributed.
Want to know how it all adds up? We’ll walk you through how these taxes work, where the money goes, and how to keep more of your cash while still enjoying the plant.
What Taxes Are Charged on Weed in NJ?
Let’s clear it up. If you’re buying recreational cannabis in New Jersey, you’re paying more than just sticker price. Between state, local, and behind-the-scenes fees, the final cost can sneak up fast.
State Sales Tax: 6.625 Percent Across the Board
Every recreational weed purchase includes a 6.625 percent sales tax. This is New Jersey’s standard sales tax applied to most goods and services, and cannabis is no exception.
It is the baseline tax you’ll see at the register no matter which dispensary, supermarket, or restaurant you visit.
Local Cannabis Tax: Up to 2 Percent More
On top of the state rate, towns in New Jersey can add their own local cannabis tax. Some do. Some don’t. And that difference matters.
- Local taxes vary by town: One place might charge 2 percent while the next town over charges nothing
- This creates uneven pricing: Two dispensaries down the road from each other can offer the same product at different out-the-door prices
It all depends on how your town handles cannabis policy. And if you’re not paying attention, you might end up paying more just because of where you shop.
Social Equity Excise Fee (SEEF): A Hidden Cultivator Tax
Now here’s the one most people miss. The SEEF is not on your receipt. You will not see it itemized. But you are paying for it.
This fee is charged to cultivators based on how much they grow. The more they produce, the more they pay. And those costs often get passed along to the rest of us.
- Started at $1.10 per ounce in 2022
- Raised to $2.50 per ounce in 2025
- Poised to go higher in the near future
It does not hit the dispensary directly. But if growers are paying more, retail prices go up. That means the SEEF affects every customer, even if they have never heard of it.
Where Does All This Tax Money Go?
You pay your taxes. You expect that money to do something. With weed in New Jersey, the story is not that simple. A lot of money is coming in, but very little is getting out to the people who were promised support.
The $6 Million Question: SEEF Funds Sitting Idle
The Social Equity Excise Fee, or SEEF, was created to give back to the communities hit hardest by cannabis criminalization. That was the pitch. The idea was to collect money from cultivators and funnel it into real programs that support housing, job creation, and small business development in impacted areas.
But here is the reality.
- The Cannabis Regulatory Commission cannot spend the money: They collect the data, listen to public input, and make suggestions, but they have no power to actually release the funds
- The Legislature controls it: Elected officials in Trenton decide when and how that money moves, and so far, they have moved slow
- More than $6 million is sitting untouched: Despite multiple hearings, reports, and community feedback sessions, not a single dollar has reached the neighborhoods it was meant to help
It has been over three years since legal sales began. Communities were told they would see investment. What they got instead is silence. That has led to growing frustration among business owners, equity license applicants, and the everyday customers who were told this system would be different.
Local Taxes: A Black Box
In addition to state taxes and SEEF, towns that allow cannabis sales can impose up to a 2 percent local tax. That money goes directly into municipal budgets.
Sounds simple enough. The problem is what happens next.
- Towns can use the money however they want: There are no rules requiring them to invest it back into cannabis education, public health, or reinvestment in impacted communities
- No required reporting exists: Towns do not have to tell the state, the CRC, or the public how that money is spent
Some towns may choose to use that money for good things like road improvements or addiction services. Others might use it to plug budget holes or fund unrelated expenses. The point is, nobody really knows. And without any kind of tracking system, there is no way to hold anyone accountable.
So when customers ask, “Do we even know where this money goes?” the honest answer is no. And that is a problem for anyone who believed this industry was supposed to right past wrongs.
Are NJ Cannabis Taxes Going Up?
If you are hoping that weed prices in New Jersey will drop soon, do not hold your breath. The numbers are heading in the other direction, and the pressure is building across the supply chain.
The Trend Line Says Yes
The Social Equity Excise Fee has already doubled. What started at $1.10 per ounce is now $2.50. And some voices in the industry are pushing to take it even further.
- There is talk of raising the SEEF to $15 per ounce: That is six times the current rate
- Some advocates are pushing for the full $30 per ounce cap: Their goal is to increase funding for social equity, but it comes with a cost
- Retail prices are still high: Not just because of taxes, but because there are so few licensed cultivators in the state
That lack of supply means dispensaries are paying more to stock shelves. And when dispensaries pay more, so do customers. The SEEF adds another layer of pressure. Even if more shops open, prices could stay locked at high levels unless something shifts at the cultivation level.
Why Are Prices So Damn High?
New Jersey’s cannabis market is still young. There just aren’t that many licenced cultivators growing in the state. That limited supply drives up wholesale prices, which trickles down to what you see on the shelf.
- Cultivators set the tone: Fewer growers means less competition, which means higher prices across the board
- The legacy market still has its grip: Many consumers stick to underground options where taxes do not apply and prices are lower
- Dispensary pricing is not consistent: Some shops add massive markups while others, like us, focus on fairness and value
So when people blame taxes for every dollar on the receipt, they are only seeing part of the picture. The lack of cultivation infrastructure, combined with inconsistent retail strategies, makes for an unpredictable experience for the customer.
New Stores, Same Problems?
Well over 200 recreational dispensaries have opened across New Jersey. That sounds like progress, and in some ways, it is. But the real bottleneck is still behind the scenes.
Without more cultivators, even the newest shops are stuck buying from the same limited pool of suppliers. That keeps wholesale costs high and leaves little room for competitive pricing.
We believe prices should come down with time. But until there are more growers and better distribution, most shops will be stuck charging more than they want to.
How to Pay Less for Your Weed in NJ
You should not need a spreadsheet to figure out how to save money on cannabis. But with New Jersey’s mix of taxes, fees, and markups, a little strategy can go a long way. Here are a few ways to keep more green in your wallet.
Go Medical—It’s Worth It
If you qualify for medical use, getting your card is one of the best ways to cut costs.
- No sales tax applies to medical cannabis: That means instant savings every time you check out
- No SEEF fee gets passed down to medical transactions: Medical cultivators do not get charged the SEEF fee. This keeps the base price of products lower compared to recreational options
- Service is often quicker and access can be better: Medical lines move faster and certain products may be available only to patients
If you’re a regular consumer or use cannabis to manage pain, sleep, or anxiety, going medical is not just about access, it’s about value.
Shop Smart with Loyalty Programs
Not all dispensaries are built the same. Some toss on hidden fees. Others, like ours, reward customers who come back.
- We offer loyalty points, real discounts, and member perks: No games, just ways to stretch your dollar
- Final pricing matters: Always look for dispensaries that show out-the-door pricing with tax included so you are not hit with surprises at checkout
Being informed helps you avoid sticker shock. And loyalty programs make a big difference if you are buying regularly.
Consider Location
The same eighth can cost you more or less depending on where you buy it. Local taxes vary, and some towns choose not to add extra fees at all.
- Different towns mean different taxes: Some charge the full 2 percent, some charge nothing
- Border towns often have lower taxes: If you are close to a line, it might be worth the short drive
Shopping smart is not just about product—it is about place. Know your zones and you might find better pricing without changing anything else.
What Needs to Change in NJ Weed Tax Policy?
The system is live, but it is far from perfect. If the goal is fair pricing, real equity, and better access for all, New Jersey still has some work to do. Here is where the policy needs to catch up.
Real Transparency Around SEEF Spending
The SEEF was supposed to be about justice. Communities hurt by cannabis prohibition were promised reinvestment. But without transparency, those promises mean nothing.
- Let taxpayers track how equity funds are used: There should be public access to where every SEEF dollar goes
- Towns should be required to report cannabis tax spending: No more guesswork. If a town collects, they should disclose how it is spent
This is not about creating more red tape. It is about building trust. If the state wants community support for cannabis, it needs to show receipts.
More Cultivator Licenses = Real Competition
Dispensaries do not set wholesale prices. Cultivators do. And right now, there are not enough of them to push prices down or shake up the supply chain.
- We need more licenses for smaller, local growers: They keep pricing honest and bring diversity to the market
- Stop favoring large operators with deep pockets: The current system rewards scale, not quality
The real fix is not just opening more dispensaries. It is about expanding the base of who gets to grow and supply. Until that changes, prices will stay high and access will stay uneven.
And for those wondering who controls the money and the rules—it is the New Jersey Legislature. Not the Cannabis Regulatory Commission. And yes, they have been slow. The industry is moving faster than the policy. That gap is holding everyone back.
The Weed’s Legal, But the Tax Game’s Still Sketchy
Whether you are a casual smoker or using cannabis to manage your day-to-day, understanding how New Jersey taxes this plant helps you make better choices and avoid overpaying. These taxes are layered, inconsistent, and still evolving. And while lawmakers figure it out, the rest of us are left doing the math at checkout.
The good news is this. The more people learn about how the system works, the more pressure there is to fix it. Smarter shoppers and louder voices are already pushing for better transparency, fairer prices, and real reinvestment in the communities that need it most.
Until then, we are doing what we can on our side. We keep our shelves stocked with quality flower and products that we would actually buy ourselves, and we fight to keep our prices among the lowest in New Jersey.
Want to see how much further your dollar can go?
Come by Cuzzie’s and check out some of the most affordable weed in New Jersey. No gimmicks. No surprises. Just good bud at prices that make sense.
