SAGINAW, Mich. — Michigan’s new wholesale marijuana tax has generated millions of dollars for road repairs, but the revenue is falling far short of what lawmakers projected.
The 24% tax took effect Jan. 1 as part of the state’s updated road funding plan. State reports show the tax generated roughly $34 million through the end of April. That’s about $70 million below what lawmakers originally projected.
Statewide recreational marijuana sales have also trended lower than they did during the same period last year. Local dispensaries say they’re monitoring the trend closely.
“They’re still coming in, but data shows they’re spending about 10% less,” said David Vallegos, assistant store manager at House of Dank.
Industry groups argue higher taxes could push some customers toward the illegal market.
“Customers are going to the black market because data is showing that the unregulated markets are gaining higher sales right now,” said Vallegos.
State regulators say it’s too early to know whether that’s happening. For now, dispensaries are watching the numbers while lawmakers watch whether a key piece of Michigan’s road funding plan can catch up to expectations.
“Just listen to the people,” said Vallegos. “We voted it in at a certain tax and I believe they should listen to what the people wanted.”
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