The New Jersey legislature did not raise the Social Equity Excise Fee (SEEF) cannabis tax in its final budget for Fiscal Year (FY) 2026, which started last week on July 1st.
According to the progressive NJ Policy Perspective (NJPP) think tank, “this initiative would have raised much-needed revenue for the communities … still waiting for justice from cannabis legalization suffered another setback today as the state Senate and Assembly passed an appropriations bill that increases the state’s structural deficit while rejecting the Governor’s proposal to raise the Social Equity Excise Fee (SEEF).”
“It is deeply disappointing that the Fiscal Year 2026 budget does not include the Governor’s proposal to increase the SEEF to 15 percent,” said NJPP Senior Policy Analyst Marleina Ubel.
“This omission represents a missed opportunity to make meaningful investments in the very communities that were most harmed by the War on Drugs,” she added.
Ubel said the SEEF revenue is supposed to provide direct support and help rebuild communities that have suffered under unfair and discriminatory drug policies.
“The proposed increase would have strengthened New Jersey’s commitment to equity and justice, allowing more funding to flow into programs and services that can truly make a difference,” she argued.
“This is not just a matter of money. It is about making things right. We urge lawmakers to revisit this issue. And move forward with a fee increase that honors the SEEF’s mission and maximizes its impact,” Ubel added.
NJ SEEF Cannabis Tax Issues
Governor Phil Murphy (D)indicated he wanted to raise the SEEF through the legislative process. It was part of his initial FY 2026 budget proposal. However, Murphy never mentioned the SEEF specifically during budget talks this spring.
The NJ Cannabis Regulatory Commission (NJ-CRC) is supposed to be in charge of this. They raised the SEEF last December.
Many NJ cannabis businesses, both large and small, were opposed to a raise last year. The NJ CannaBusiness Association and the NJ Cannabis Trade Association were against it. Ultimately, they were happy it was a small increase.
Urb’n dispensary owner Max Maxemous of Newark was happy the SEEF was not raised as a small businessman. He is likely not the only one.
The SEEF is supposed to be a whole tax paid by businesses on “usable cannabis”. Many cannabis industry advocates said the cost would be passed on to consumers. Many of them are already unhappy with the high price of legal cannabis.
However, social justice advocates tried their best.
The SEEF was supposed to be raised as the price of cannabis drops.
The budget process was especially chaotic and challenging this year, likely due to President Donald Trump’s cuts to state aid.
