Michigan Treasury Releases Guidance on New 24% Wholesale Marijuana Tax

The Michigan Department of Treasury today released new guidance that explains how the state’s new 24 percent Wholesale Marijuana Tax works and what cannabis businesses need to know as quarterly payments begin this year.

The tax—which took effect Jan. 1, 2026—applies to the first sale or transfer of adult‑use marijuana from a licensed marijuana establishment to a marijuana retail licensee. Treasury’s Revenue Administrative Bulletin outlines who must pay the tax, how it must be calculated and when the tax is due.

“We know this is the first year of a new tax, and we want to help businesses adjust smoothly as we implement this policy,” State Treasurer Rachael Eubanks said. “As a transition‑year measure, Treasury is providing relief from penalties and interest for businesses that make good‑faith quarterly payments. The guidance outlines what businesses need to do, and we encourage everyone to begin reporting and making their quarterly payments starting with the first period ending March 31.”

Under the law, the wholesaler—the business making the first sale or transfer to a retailer—is responsible for paying the tax. This includes growers, processors, seed‑to‑sale microbusinesses that package their own products for retail and medical provisioning centers that transfer product to their adult‑use license.

A taxable sale occurs when ownership of cannabis transfers to the retailer. This may be based on the businesses’ contract or standard business practices.

The bulletin offers clear examples to help businesses understand what to do if products are returned, do not meet standards, are repackaged or are transferred between related companies.

“Feedback from our marijuana industry partners played an important role in shaping this guidance,” State Treasurer Eubanks said. “We appreciate their involvement and collaboration throughout the process.”

How is the tax calculated?

If two businesses are not related, the tax is based on the actual price the retailer pays for the marijuana product.

But if the businesses are related—or the company grows and sells its own product—Treasury uses a standard “average wholesale price list” that is updated every quarter. Because these prices may change every three months, it is important for cannabis businesses to report and pay on time.

Quarterly wholesale prices are posted on Treasury’s Wholesale Marijuana Tax webpage.

When must payment be made?

For tax year 2026, Treasury will require good-faith quarterly Wholesale Marijuana Tax payments.

Businesses are expected to begin making quarterly payments based on their activity for each quarter. Payments for 2026 will be due April 20, July 20 and October 20. A full set of quarterly tax returns for all of 2026 will then be due on Jan. 20, 2027, along with any remaining tax owed for the first three quarters and the full amount owed for the fourth quarter.

Because this is a transition year, Treasury will waive penalties and interest for the first three quarters of 2026 if a business pays at least 75 percent of what it ultimately owes for each quarter and files all required 2026 returns with full payment by Jan. 20, 2027.

Beginning in 2027, quarterly tax returns and full payment will be due each quarter.

Businesses can read the full Revenue Administrative Bulletin and find quarterly payment information at Michigan.gov/Taxes under “Business Tax” and then “Wholesale Marijuana Tax.”

While this message highlights key points, the Revenue Administrative Bulletin contains Treasury's official guidance. We encourage all taxpayers to review it carefully.

Under state law, revenue from the Wholesale Marijuana Tax will be used to fix roads and bridges.