Proposed New Michigan Cannabis Rules

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Takeaways

  • Michigan’s new 24% wholesale cannabis tax is in effect on January 1; however, Treasury’s last-minute guidance raises significant compliance, pricing, and litigation risks for licensees.
  • Treasury’s use of a blanket “average wholesale price” based on assumed markups—not actual transaction data—may conflict with statutory and constitutional requirements.
  • With constitutional challenges pending and more litigation expected, cannabis businesses should prepare now for audits, disputes, and rapidly evolving enforcement positions.

As the new year is upon us, Michigan’s wholesale cannabis tax takes effect on January 1. A mere 35 hours beforehand, Michigan’s Department of Treasury published the “average wholesale price” to be used for affiliate transfers and updated its FAQ’s. Treasury has also prepared a draft Revenue Advisory Bulletin—although Treasury has not made this public on their wholesale marijuana tax webpage.Continue Reading January 1 for Michigan Cannabis: A New Year, A New Headache

While the constitutionality of Michigan’s new marijuana wholesale tax is being reviewed by the Michigan Court of Claims, the Michigan Department of Treasury has released what Treasury is calling “preliminary information” and FAQs about the administration of the tax. (Disclosure: Dykema is co-counsel with Honigman Miller for the Michigan Cannabis Industry Association’s challenge to the tax.) Those FAQs include reassurances about some industry concerns with the tax, and state that even though the tax takes effect January 1, 2026, it won’t be collected until January 15, 2027. Unfortunately, Treasury’s “preliminary information” is not only essentially meaningless, but it also demonstrates that Treasury is just making things up as it goes along.Continue Reading Fool’s Gold: Michigan Treasury Announces Illusory Reprieve on Marijuana Wholesale Tax

At 3:00 a.m. on October 3, 2025, Michigan’s Legislature passed a 24% wholesale tax on legal marijuana sales, without hearing a single second of testimony and just eight days after the bill’s language was made public (the tax is the subject of multiple other posts here on the Cannabis Law Blog). Unless blocked by the courts or repealed, the tax will take effect on January 1, 2026.Continue Reading Michigan Cannabis Tax Passes: Numbers

Takeaways

  • Michigan lawmakers fast-tracked a new 24% wholesale cannabis tax with no hearings or industry input.
  • The bill attempts to sidestep voter-approved protections by avoiding the 75% supermajority required to amend Michigan’s cannabis initiative.
  • The tax could exceed 24% for non–vertically integrated businesses, as rebates and discounts cannot reduce the taxable amount.

As everyone in Michigan’s cannabis industry is all too painfully aware, Michigan’s Legislative leaders and Governor have agreed to create a new (minimum) 24% wholesale tax on the state’s cannabis industry. The Michigan House of Representatives passed the bill (House Bill 4951) last Thursday, September 25, and action by the State Senate is expected on Tuesday, September 30.Continue Reading Bucking the Trend: Michigan Wholesale Tax Nightmare at Hand

Takeways

  • HB 4963 would require licensees to pay for cannabis products at the time of transfer.
  • HB 4964 and related bills would create a new Industrial Hemp Processing Act and ban intoxicating or converted cannabinoids.
  • Passage appears likely, but the final impact will depend on legislative compromise and regulatory enforcement.

On Tuesday, September 16, the Chairman of Michigan’s House Regulatory Reform Committee, Representative Joseph Aragona, introduced a package of bills to address two significant problems confronting Michigan’s cannabis industry—licensees defaulting on payments and unregulated intoxicating hemp products being sold throughout the state. (This is part two of our examination of this issue in Michigan; part one can be found here, and we’ve addressed hemp issues in other states and at the federal level elsewhere on the Cannabis Law Blog.)Continue Reading Michigan House Looks to Solve Cannabis Industry Issues, Addressing Payment Defaults and Hemp Regulation