Michigan, Marijuana Plants and Taxes
Now that pot/marijuana and the recreational use of it have been made legal in Michigan what does that mean for growers and taxes in Michigan.
Well it means that the recreational users of marijuana may have to wait a while to legally grow the plants and are the Michigan citizens getting a “fair” share of the proceeds?
Let us first discuss the growing of pot. The question is how will the potential growers get the needed seeds or plants to start their grow operation. They could buy their seeds online, one problem and it is a big one is that it is illegal to purchase seeds online from the federal government’s perspective and law. If home growers where to buy the seeds online they would be violating federal law.
According to an article in the Detroit Free Press:
Actual marijuana, along with the seeds and cannabis cuttings used for home grows, won’t be commercially available for sale until the state Department of Licensing and Regulation develops the rules governing the adult recreational market. And that won’t happen until probably early 2020.
That would be quite a long time for home growers to wait and I do not see them wanting to wait that long.
The ballot proposal that passed last week will legally allow Michigan residents at least 21 years of age to grow up to 12 plants for personal use. They are not allowed to sell any of the pot they grow.
The problem these home growers face is how do they start their personal grow operations without easy access to seeds or plants?
For your information, there are currently 43,056 registered medical caregivers in the state of Michigan. They are allowed to grow up to 12 plants for each of their five patients they supply. How many registered medical marijuana cardholders are there in the state of Michigan, the answer is 297,515.
Now let us move on to the amount of taxes these recreational users will be paying here in the state of Michigan.
Did you know that Michigan marijuana users will be paying the lowest tax rates on marijuana in the entire country, Apparently legal dealers in the state of Michigan will only have to pay a 10% excise tax and of course our normal 6% sales tax. The question I have is why is the sin tax on marijuana in Michigan lower than cigarettes and alcohol?
Michigan residents pay $2 dollars in sin tax on a pack of cigarettes with the average cost of a pack being $6.44. That is almost a 50% tax if you take the $2 dollars off of the average cost of a pack.
When it comes to alcohol sin tax in Michigan, wine vendors are responsible for paying a state excise tax of $0.51 per gallon, plus Federal excise taxes, for all wine sold. In Michigan, beer vendors are responsible for paying a state excise tax of $0.20 per gallon, plus Federal excise taxes, for all beer sold.
What do other states charge for their sin tax on marijuana?
The state of Washington charges a 37% sales tax on marijuana.
The state of Colorado charge their users a 15% sales tax and a 15% excise tax.
The state of Oregon charges their users a 17% sin tax on marijuana.
The state of California charges their users a 15% excise tax plus a product-tax rate on every flower and leaf.
So the question is why did Michigan pass a law that charges marijuana users the lowest sin tax in the country and as I stated a sin tax lower than cigarettes and alcohol?
Your guess is as good as mine.
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