The Michigan cannabis industry is in the midst of a legal battle, challenging a new wholesale marijuana tax that is set to begin on January 1. The Michigan Cannabis Industry Association has taken its fight to the state’s Court of Appeals, arguing that earlier legislative actions this year breach the state’s constitution by altering voter-approved measures regarding the cannabis market.
Rose Tantraphol, a spokesperson for the Michigan Cannabis Industry Association, emphasized the urgency for a resolution before the tax’s implementation.
“The stakes are incredibly high,” Tantraphol told Michigan Public Radio. “Cannabis businesses operate on thin margins. If this goes into effect on New Year’s Day, businesses will close. Our neighbors who work in the cannabis industry will lose their jobs.”
The association’s lawsuit contends that the Michigan Legislature did not achieve the required three-fourths majority in both the House and Senate to amend the voter-endorsed initiative as mandated by the Michigan Constitution. Additionally, the lawsuit accuses the Legislature of utilizing a separate bill to indirectly change the voter-approved proposal.
Earlier this month, a Michigan Court of Claims judge mainly favored the state in an initial decision and did not issue a ruling to halt the tax from proceeding.
While the Michigan Department of Technology, Management and Budget, responsible for the tax administration, withheld comments on the ongoing litigation, the state has argued in court that the cannabis tax is a component of a broader road-funding strategy and does not modify the language of the 2018 voter-approved recreational marijuana initiative.
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