Michigan's marijuana industry has filed a second lawsuit challenging a 24% wholesale tax passed into law last year, arguing the taxing structure set up by the state compounds the levies on marijuana and overinflates a state sales tax constitutionally required to stay at or below 6%.
The lawsuit, filed by marijuana grower Mitten Distro X LLC, retailer Refine Michigan Co. and the Michigan Cannabis Industry Association, was filed Friday in the Michigan Court of Claims.
"When you do the math, the state's 24% wholesale tax on cannabis simply doesn't add up for the Michigan voters who made cannabis legal," said Rose Tantraphol, a spokeswoman for the Michigan Cannabis Industry Association. The lawsuit is the second filed by the Michigan Cannabis Industry Association in the wake of the Legislature's vote last year to impose a 24% sales tax on marijuana, a fee lawmakers estimated would generate about $420 million for roads annually.
The first lawsuit focused on the allegation that the Legislature's passage of the law in late 2025 lacked the supermajority in support needed to amend a ballot proposal. The 2018 ballot initiative legalizing recreational marijuana set a 10% excise tax at that time on retail sales. That first lawsuit is headed to trial after the Court of Claims rejected efforts to block the law immediately. Judge Sima Patel last year said the ballot proposal recognized "other taxes" and that wording seemed to be consistent with the wholesale tax passed by lawmakers.
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