Michigan’s cannabis industry is sounding alarms about Gov. Gretchen Whitmer’s plan to raise $470 million per year for roads by imposing a 32% wholesale tax on marijuana.
The governor recently proposed a new $3 billion “Mi Road Ahead” plan that she called “fiscally responsible and balanced.” She said Michigan’s “industry friendly” marijuana tax is the fourth-lowest in the nation and helped fuel an explosion of marijuana retailers.
The proposed tax increase would come atop the 10% excise tax on recreational marijuana that consumers pay on top of the state’s 6% sales tax. The wholesale tax would directly impact growers, and that cost would be passed down to retailers and consumers.
“The Mi Road Ahead Plan would close a loophole that exempted the marijuana industry from wholesale tax, which is applied to similar smoking products, like cigarettes, and other tobacco items,” Whitmer said.
The state taxes cigarettes at $2 a pack and levies a 32% tax on non-cigarette tobacco products at the wholesale level.
Retailers say the marijuana industry is already struggling enough.
“There are other ways for (Whitmer) to fix the roads,” said Al Williams, president of DaCut, a dispensary in Detroit. “We want to work with her on that, but 32% is ridiculous.”
“This could not come at a worse time,” said Williams, who is running for chair of the Michigan Democratic Party. “I think this increase actually would encourage more people to operate in the black market.”
H/T: www.bridgemi.com
