(LANSING) - Michigan's cannabis industry is escalating its fight against the state's new 24% wholesale marijuana tax, filing a second lawsuit aimed at blocking the levy as the first quarterly payments come due this month.
The Michigan Cannabis Industry Association argues the tax creates "tax pyramiding" by stacking the new wholesale charge on top of the existing 10% excise tax and 6% sales tax already applied to recreational marijuana sales. Industry leaders contend that structure violates constitutional tax limits and unfairly burdens legal businesses.
This latest legal challenge adds to an ongoing court fight over whether lawmakers improperly approved the tax with a simple majority vote instead of the three-fourths supermajority required to alter Michigan's voter-approved 2018 marijuana law.
State officials maintain the wholesale tax is a separate road-funding measure that directs revenue into Michigan's neighborhood road fund for infrastructure improvements.
Industry groups warn the added tax pressure could force smaller marijuana businesses to close and drive more customers back to the illegal market.
With the Treasury Department preparing to collect the first good-faith quarterly payments on April 20, the legal battle is widely expected to continue through Michigan's appellate courts and could ultimately reach the state Supreme Court.