Michigan's Cannabis Industry Faces a Steep Tax Hike

A New 40% Tax Burden

Michigan's cannabis industry is bracing for impact as a new tax policy takes effect. Starting January 1st, a 24% wholesale tax is added to the existing 10% retail tax and 6% sales tax, resulting in a total tax of 40%.

The Impact on Businesses

Green Acres Cannabis is among those feeling the squeeze. Abbas Chami, the company's Chief Financial Officer, expresses concern:

"The extra cost is tough to swallow. We can't keep prices the same for customers. We have to pass some of the cost to them and absorb some ourselves to stay competitive."

State Revenue vs. Industry Survival

The state anticipates an additional $420 million annually from this tax, earmarked for infrastructure projects. However, Chami is skeptical:

"I think the market can't handle it. I fear some businesses might not survive."

Industry Pushback

The Michigan Cannabis Industry Association, representing over 400 producers, is challenging the tax. They've filed appeals, hoping to strike it down completely.

Business owners are worried, citing potential job losses and other economic repercussions.