Some cannabis folks in Michigan, including the state’s top cannabis trade association, the Michigan Cannabis Industry Association, are fuming after the Michigan House approved [1] a 24% wholesale tax on marijuana – part of a state budget deal that aims to raise $420 million a year for roads. The initiative hasn’t passed the senate yet.
The cannabis operators say the legislation violates the 2018 voter-mandated rules (which, by the way, left out a wholesale tax).
According to a report from Bridge Michigan [2], these folks are claiming that the legislature is “amending” the people’s will pertaining to a citizen initiative without hitting the required three-fourths threshold.
So now they are consulting lawyers instead of waiting for their next ganja shipment.
Lawmakers, apparently surprised that industries might balk at being taxed to death, insist they’re on legal solid ground after some internal legal pals reviewed it. The tax isn’t even as high as Democratic Michigan Governor Gretchen Whitmer wanted, as she once floated a 32% tax [3].
Folks in the cannabis industry warn that the tax hike could wipe out 47,000 jobs, and here’s the kicker: it might sabotage the legal market altogether. Retailers could be forced to shrink staff or close up shop entirely, while the black market – that lovely tax- free alternative – may see a fresh resurgence.