Governor Gretchen Whitmer’s proposal of a 32% wholesale tax on marijuana as part of her MI Road Ahead plan has sparked significant worry among recreational cannabis users and industry stakeholders in Michigan. Recreational users are concerned that this new tax, which would be added on top of the existing 10% excise tax and the 6% sales tax, could lead to sharply higher prices for marijuana products, making access more expensive and potentially unaffordable for many who rely on it for personal use. Medical marijauna patients will not have to pay the tax.
The current tax structure was designed to keep legal marijuana prices competitive with the black market, encouraging consumers to buy legally. However, recreational users fear that the added wholesale tax will increase costs throughout the supply chain and ultimately be passed on to them at retail, undermining affordability and access. Some in the industry warn that these higher costs could push growers and retailers into financial distress, possibly forcing some out of business or driving more sales back into the illicit market, which users want to avoid.
Medical cannabis users, who currently pay only the 6% sales tax and are exempt from the 10% excise tax, would likely not be impacted if wholesale taxes are applied to the recreational industry.
In summary, Michiganders’ primary concern is that the proposed 32% wholesale tax will raise marijuana prices significantly, threatening affordability and access to legal cannabis products, and potentially driving more consumers back to the black market