Governor Whitmer signed legislation creating a 24% wholesale tax on marijuana. This was part of the overall budget negotiations this year and accounts for a portion of additional funding for roads and bridges. The new tax is in addition to the 10% excise tax and 6% sales tax currently placed on the industry.
Key Points:
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- The new tax is projected to generate $400 million annually in new revenue.
- The revenue will be distributed to the newly created Neighborhood Road Funds.
- The fund provides funding to local governments for roads and bridges. The legislation enacting it was also signed into law this week.
- It will take effect January 1, 2026.
Legal Challenge:
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- The Michigan Cannabis Industry Association filed a lawsuit in the Court of Claims this week.
- The association asks the court to block the tax and declare it illegal.
- They state that since the legalization of marijuana is a voter-initiated law, the legislature needed a three-fourths vote of both chambers to make any changes.
- Neither chamber met that threshold, with the House voting 78-21 and the Senate 19-17 in favor.
