Michigan Lawmaker Proposes Cannabis Tax Suspension
Representative Jay DeBoyer aims to pause the state’s 24% wholesale cannabis tax for one year to provide industry relief.
Updated on Oct. 26, 2026 in Legislative Policy
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State Representative Jay DeBoyer has announced plans to introduce legislation that would suspend Michigan’s 24% cannabis wholesale tax for 12 months. The proposal follows concerns from stakeholders that the current tax structure is driving operators out of business and pushing consumers toward the black market.
Why it matters
The tax has generated only 35% of its projected revenue during the first half of 2026, leading to claims that the levy lacks a functional collection mechanism. Industry advocates argue that the burden is unsustainable for licensed retailers who are already facing economic challenges.
Michigan collected $73.4 million from the 24% wholesale tax in the first half of 2026, reaching only 35% of its anticipated revenue target. The state also maintains a 10% retail excise tax and a 6% sales tax on cannabis products.
The players
Jay DeBoyer
Representative Jay DeBoyer is a Michigan state legislator who represents the state's district encompassing Clay Township.
John James
John James is a gubernatorial candidate who has stated his intent to reduce or repeal the 24% wholesale cannabis tax if elected.
Michigan Cannabis Regulatory Agency
This state body is responsible for tracking retail market sales and pricing data across Michigan.
The details
DeBoyer intends to introduce the bill to address revenue shortfalls and lack of enforcement for the wholesale tax, which took effect on January 1, 2026. Retail cannabis sales in the state are projected to reach $3 billion for the full year of 2026.
Timeline
Voters passed adult-use cannabis legalization in 2018.
Michigan cannabis retail market reached $3.3 billion in 2024.
Michigan cannabis retail market reached $3.2 billion in 2025.
The 24% cannabis wholesale tax took effect on January 1, 2026.
Representative Jay DeBoyer announced the plan for a tax suspension on October 22, 2026.
Political Context
The proposed suspension marks a significant shift from the legislative goals of the Comprehensive Road Funding Tax Act. Opposition to this measure likely centers on concerns regarding the loss of dedicated funding for state infrastructure projects.
Consumers may see price stability if the tax suspension reduces the overhead costs currently affecting retail cannabis businesses. The potential change in revenue collection could influence future funding allocations for state road and infrastructure projects.
The takeaway
The debate over the cannabis wholesale tax highlights the complexities of balancing state infrastructure funding with market viability. Business owners and consumers should monitor legislative sessions to see if temporary tax relief measures move forward into law.
Further reading
For more on state government activities, visit Legislative Policy.
Source note: This article includes information reported by Cannabis Business Times.
Live Poll
Should Michigan eliminate the 24% wholesale cannabis tax to support local businesses?
