Michigan medical marijuana patients are expected to pay a 3% MMFLA tax and a 6% sales tax on purchases from dispensaries under Michigan’s new cannabis distribution program as required by law, but a reversal of policy from the Department of Treasury requires patients not using dispensaries to pay a 6% penalty, too, and that has the patient services community up in arms.
In REVENUE ADMINISTRATIVE BULLETIN 2018-2 issued January 18 the Department of Treasury has decided to re-interpret the MMMA language and reverse their previous position on the taxation of cannabis sales. Every time a patient purchases cannabis from their registered caregiver the patient must log the sale and self-report a 6% use tax on the transaction, per the new directive.
“The Michigan Department of Treasury is exceeding it’s authority by implementing a new “PATIENT TAX” that requires registered patients to pay a 6% use tax on medical cannabis purchased from their caregiver,” wrote Matthew Abel, founding partner of the law firm Cannabis Counsel PLC and the Executive Director of MINORML.
The policy change comes without any associated change in MMMA language or court result, leaving the state’s 300,000 patients questioning the logic and the timing of the policy change.
“This new tax structure puts significant additional legal burden on caregivers operating in an already murky area of law,” said attorney Bruce Leach. “It signals the state’s clear intent to make caregiving as difficult as possible while the state moves to eventually eliminate caregivers altogether in favor of the regulated commercial market. If the state is going to implement this tax system then it is only fair that caregivers be allowed to have their goods properly enter into the regulated market.”
Caregivers are prevented from selling their goods through the state’s new dispensary system. Patients purchasing directly from a caregiver was