A Michigan marijuana dispensary owner is speaking out as the cannabis industry braces for a major new tax that some fear will hurt local businesses. The state's additional 24% wholesale marijuana tax is set to take effect January 1, on top of existing state taxes. Lawmakers said it's about fixing roads, but some dispensaries believe it could drive customers to illegal markets.
"It'll make buying cannabis from licensed shops in Michigan less, there's less incentive to do so when the prices go up," said Joshua Covert, CEO of Meds Café. Michigan's cannabis boom could soon hit a wall with the steep new 24% wholesale tax. He said the industry is already fighting back in court.
"Right now, there is a lawsuit pending at the Court of Claims that will hopefully, you know, at least stop or temporarily stop the tax, and we're waiting to see what's going on with that," said Covert. If the tax stands, Michigan's marijuana will face some of its highest costs yet — stacked on top of the existing 10% excise and 6% sales tax.
"The primary argument, from what I understand, is that it circumvents the direct democracy. This was a voter initiative. We put it together as the people of the state of Michigan and they're essentially circumventing that bill with with a new tax," said Covert.
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