Photo: FatCamera / iStock / Getty Images
LANSING, Mich. -- Michigan's Attorney General's Office has declared the state's new 24-percent wholesale tax on marijuana constitutional. The tax, part of the Comprehensive Road Funding Tax Act, aims to generate revenue for road funding by imposing a 25-percent excise tax on marijuana wholesale transactions. The AG's office argues that the tax does not amend the voter-initiated law that legalized marijuana in 2018, which already allows for additional taxes beyond the existing 10-percent excise tax.
The Michigan Cannabis Industry Association and PG Manufacturing have filed lawsuits against the state, claiming the tax is unconstitutional and requires a three-fourths supermajority in the Legislature to amend the voter-approved law. However, state attorneys argue that the new tax is separate and independent, and does not alter the original law. The lawsuits have been consolidated, and a hearing is scheduled for November 25 in Detroit.
The tax, set to take effect on January 1, 2026, is expected to raise $420 million annually for road repairs. Opponents argue it could harm businesses, encourage black market activity, and increase prices for consumers. Despite these concerns, state officials remain confident in the tax's legality and its role in funding infrastructure improvements.