Michigan's cannabis industry group urges the Michigan Court of Appeals to block a new wholesale tax on marijuana before it takes effect, arguing that the tax is unconstitutional and could lead to financial ruin for many businesses.
The Michigan Cannabis Industry Association (MiCIA) has filed an application for leave to appeal after a court ruling declined to stop the tax from taking effect while the case continues. The group claims that lawmakers pushed the tax through using a "shell bill," changing its purpose late in the legislative process, which is unconstitutional under the state's constitution.
The 24% wholesale tax is set to take effect on January 1 and would significantly increase prices for cannabis operations, potentially driving some businesses out of the market. Industry leaders warn that this could lead to consumers turning back to the illicit market, exacerbating existing supply chain issues in the industry.
"We stand by our belief that the Court of Claims did not make the right call when it issued an opinion that declined to block the Michigan Legislature's unconstitutional 24% wholesale tax on cannabis from going into effect on New Year's Day," said MiCIA spokesperson Rose Tantraphol. "Our filing requests that the Court of Appeals take up our lawsuit, which we continue to believe is an exceptionally strong case on the merits."
The new tax would further strain a market already struggling with oversupply, falling prices, and shrinking profit margins. In November, the average retail price of recreational flower dropped to a record low of $59.79 per ounce, down from $512 when legal sales began in 2020.
Adding a 24% wholesale tax would push Michigan's cannabis prices close to those in California, where high taxes have eroded parts of the legal market and driven consumers back underground. This has already led to business closures, job losses, and concerns about the state's own Senate Fiscal Agency predicting that total sales will decrease by around 14%.
MiCIA argues that lawmakers need a three-quarters supermajority to change voter-approved cannabis laws under the Michigan Constitution. The group is seeking an immediate review of their case at the Court of Appeals, warning that delaying this could cause "unnecessary harm" to the industry.
The stakes are high for MiCIA and the state's cannabis industry as a whole. With thousands of jobs dependent on the market, the association is urging the court to take action before it's too late.
The Michigan Cannabis Industry Association (MiCIA) has filed an application for leave to appeal after a court ruling declined to stop the tax from taking effect while the case continues. The group claims that lawmakers pushed the tax through using a "shell bill," changing its purpose late in the legislative process, which is unconstitutional under the state's constitution.
The 24% wholesale tax is set to take effect on January 1 and would significantly increase prices for cannabis operations, potentially driving some businesses out of the market. Industry leaders warn that this could lead to consumers turning back to the illicit market, exacerbating existing supply chain issues in the industry.
"We stand by our belief that the Court of Claims did not make the right call when it issued an opinion that declined to block the Michigan Legislature's unconstitutional 24% wholesale tax on cannabis from going into effect on New Year's Day," said MiCIA spokesperson Rose Tantraphol. "Our filing requests that the Court of Appeals take up our lawsuit, which we continue to believe is an exceptionally strong case on the merits."
The new tax would further strain a market already struggling with oversupply, falling prices, and shrinking profit margins. In November, the average retail price of recreational flower dropped to a record low of $59.79 per ounce, down from $512 when legal sales began in 2020.
Adding a 24% wholesale tax would push Michigan's cannabis prices close to those in California, where high taxes have eroded parts of the legal market and driven consumers back underground. This has already led to business closures, job losses, and concerns about the state's own Senate Fiscal Agency predicting that total sales will decrease by around 14%.
MiCIA argues that lawmakers need a three-quarters supermajority to change voter-approved cannabis laws under the Michigan Constitution. The group is seeking an immediate review of their case at the Court of Appeals, warning that delaying this could cause "unnecessary harm" to the industry.
The stakes are high for MiCIA and the state's cannabis industry as a whole. With thousands of jobs dependent on the market, the association is urging the court to take action before it's too late.
they need to rethink this ASAP bc people are already getting prices so low its like they're not even making money anymore 
and yeah california is proof of what happens when u got high taxes on weed ppl just go back to buying it from those shady streets 
anyway i hope the court of appeals does their thing soon cuz thousands of jobs r at stake 
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. That's some shady stuff right there. I'm not saying MiCIA isn't doing their due diligence, but come on, can't they at least try to make the case for why this tax is necessary? 
. Thousands of people are counting on it to make a living, and now this tax could be the nail in their coffin 
. It's like the state is just throwing them under the bus 
.
. We need to support our own industries, you know? 
. Adding another 24% on top of that is just gonna be too much 
. I hope the Court of Appeals can block this tax before it's too late 
.
The industry's already struggling with supply issues and low prices, so adding more pressure like this could be disastrous... 
The Michigan Cannabis Industry Association is totally on point with this one! I mean, who wants to drive their businesses into financial ruin? 
A 24% wholesale tax sounds like a recipe for disaster, especially when you consider the market is already struggling with oversupply and falling prices. And let's not forget about consumers turning back to the illicit market... that's just a nightmare scenario. 
I'm totally with MiCIA on this one - lawmakers need to rethink their approach and not try to sneak in changes like this late in the legislative process. It's all about fairness and keeping the industry afloat. Can't wait to see what the Court of Appeals decides! 
and drive them out of business. the whole thing with the "shell bill" is also super suspicious 
... if they're pushing a tax through that's not even what they initially intended, that's a major red flag 
we don't want to see thousands of jobs lost because of some dodgy tax policy 
. We need to make sure that lawmakers listen to the industry and don't just rush through stuff like this without thinking it through 
. It's all too much for me, dude!
their prices are so high they cant even compete with black market stuff 
