LANSING, Mich. (Michigan News Source) — Michigan’s cannabis industry tried to blunt the state’s new 24% wholesale marijuana tax. A judge refused, however, clearing the way for the levy to hit Jan. 1.

Court of Claims Judge Sima Patel on December 8 declined to pause the tax before it takes effect Jan. 1, ruling that businesses hadn’t shown they were likely to win their challenge. 

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The Michigan Cannabis Industry Association argues lawmakers needed a three-fourths supermajority to approve the tax because it effectively alters the 2018 ballot measure that legalized recreational marijuana and set a 10% retail tax.

Patel disagreed—at least for now—saying the ballot language allowed for “other taxes.” But she also said key questions remain about whether the 24% levy undercuts voters’ intent, meaning the broader lawsuit continues.

The tax is central to a road-funding deal expected to generate about $420 million a year. The industry plans an immediate appeal.