Hmmm – What’s next?

Summary of Michigan HB4951 (2025):

House Bill 4951, introduced by Rep. Samantha Steckloff (D–Farmington Hills), is part of Michigan’s broader infrastructure funding initiative. The bill proposes a new 24% excise tax on wholesale marijuana transfers, effective January 1, 2026. This tax is in addition to the existing 10% excise tax and 6% sales tax already levied on marijuana sales.

The bill says “THE PEOPLE OF THE STATE OF MICHIGAN ENACT” like they all do. But did you enact it?

Status: Yes, HB4951 passed the Michigan House on September 25, 2025, with a 78–21 vote. It is part of a larger budget agreement expected to pass before the end of the fiscal year on September 30, 2025.

Impact on Marijuana Taxes:

• Adds a 24% excise tax on wholesale marijuana transactions:
  • From growers/processors to retailers.
  • From provisioning centers to retail licensees.
  • On marijuana cultivated or processed by retailers themselves.
• The tax is calculated based on the wholesale price, which includes all fees and charges but excludes discounts or rebates.
• Revenue from this tax will be split between two new funds they are calling:
  • Comprehensive Road Funding Fund – for administering the tax system.
  • Neighborhood Road Fund – for road construction, maintenance, and preservation statewide.
• Estimated annual revenue: $420 million (420 – Just to slap you in the face).

• Full bill text and legislative history
• Legislative analysis PDF

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“1. What is HB4951 and why was it introduced?

HB4951 is a Michigan bill passed in 2025 that imposes a new 24% excise tax on wholesale marijuana transfers. It was introduced as part of a broader infrastructure funding package to generate revenue for road repairs and maintenance without increasing general taxes. The bill targets the cannabis industry due to its rapid growth and profitability.

2. How does HB4951 change marijuana taxation in Michigan?

Before HB4951, Michigan taxed marijuana with:

• A 10% excise tax on retail sales.

• A 6% sales tax.

HB4951 adds:

• A 24% excise tax on wholesale transfers, including:

  • Transfers from growers/processors to retailers.

  • Transfers between provisioning centers and retail licensees.

  • Internal transfers within vertically integrated businesses.

This wholesale tax is calculated based on the total price paid, including fees but excluding discounts. So a tax upon the fee which is just another tax?

3. Who pays the new 24% wholesale tax under HB4951?

The tax is levied on marijuana businesses—specifically growers, processors, and retailers—when marijuana is transferred at the wholesale level. Consumers won’t see this tax directly at the point of sale, but it may indirectly affect retail prices as businesses adjust to the increased cost burden.

4. Where does the revenue from HB4951 go?

Funds collected from the new tax are split between two new state funds:

• Comprehensive Road Funding Fund – supports tax administration and infrastructure planning.

• Neighborhood Road Fund – finances road construction, maintenance, and preservation across Michigan.

The estimated annual revenue from HB4951 is around $420 million.

5. When does HB4951 take effect, and has it officially passed?

Yes, HB4951 passed the Michigan House on September 25, 2025, and is expected to be signed into law as part of the state’s budget agreement. The new wholesale marijuana tax will take effect on January 1, 2026.

For more information, vist the Michigan Cannabis Regulatory Agency website. The foundation of the state’s cannabis market is the Michigan Regulation and Taxation of Marihuana Act (MCL 333.27951 et seq.), which governs the entire adult-use industry.

Komorn Law, established in 1993, has the experience and expertise to fight your case in a court of law from the district to federal court systems. So, when you’re ready to hire a lawyer who hates to lose, call the office at (248) 357-2550.

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