HB 6440: Michigan Rep. Jay DeBoyer files bill to pause the state's 24% wholesale marijuana tax for one year

Michigan state Rep. Jay DeBoyer, R-Clay Township, has formally introduced House Bill 6440, which would suspend the state's 24% wholesale marijuana tax for one year. The bill was introduced Wednesday, Oct. 28, read a first time and referred to the House Committee on Appropriations, according to the Michigan Legislature's bill record. Marijuana Moment and MMJDaily reported on the bill Oct. 29.

The filing follows DeBoyer's Oct. 22 announcement, which Hemp Law Watch covered earlier this week, before a bill number had been assigned. DeBoyer is also the Republican nominee for lieutenant governor, running with gubernatorial nominee John James in the Nov. 3 election.

What the bill says

House Bill 6440 is short. It amends section 5 of the Comprehensive Road Funding Tax Act, 2025 PA 23 (MCL 205.905), the law that created the 24% wholesale excise tax beginning Jan. 1, 2026, according to the introduced bill text.

The bill keeps the existing tax language, which levies 24% of the wholesale price in three situations: on the first sale or transfer of marijuana from a marijuana establishment to a retail licensee; on marijuana that a retailer cultivates and processes for its own retail sale; and on sales or transfers from a provisioning center to a retail licensee.

It then adds a new subsection. Under that language, the tax "is not levied or imposed during the period beginning on the effective date of the amendatory act that added this subsection and ending on the date that is 1 year after the effective date of that amendatory act."

In plain terms, the pause would start only if the bill becomes law, and would run for one year from its effective date. The introduced text does not set a calendar start date, does not repeal the tax and does not change the state's separate 10% retail marijuana excise tax or 6% sales tax. Nothing changes for licensed businesses unless the Legislature passes the bill and it is signed into law.

What DeBoyer says

DeBoyer laid out his reasoning in the Oct. 22 release from the Michigan House Republicans, and Marijuana Moment repeated the statement Oct. 29 in reporting that he had filed the bill.

"The road funding plan that taxed marijuana was created and signed in haste by the Whitmer administration to generate revenue, and we've seen the impacts of that haste," DeBoyer said. "The tax is generating tens of millions of dollars less in revenue than what was projected and there's no enforcement agency to collect it. It's also driving the marijuana industry back into the black market and forcing business owners who are following the law to compete with nefarious actors. This is a lose-lose."

"I supported the original legislation at large for needed road funding, but I was always skeptical to impose a tax with no mechanism to collect it. The problems with that were clear," he said. "This pause is needed to reevaluate the future effectiveness of the tax. Otherwise, it's a useless tax and the state is forcing local businesses to pay for a policy that isn't working as intended. This should be addressed."

Industry reaction

The Michigan Cannabis Industry Association (MiCIA) welcomed the bill. Executive Director Robin Schneider said in a press release Thursday that the group is "grateful to Rep. DeBoyer for recognizing the damage this tax is doing and for stepping up with a practical way to stop it while we work toward a real solution," Marijuana Moment reported.

"The 24 percent tax on cannabis isn't fixing the roads, but it is destroying Michigan businesses," Schneider said, according to Marijuana Moment. "A 12-month pause will give what's left of our cannabis businesses time to stabilize and keeps customers in the regulated market, instead of driving them to the illicit market."

MiCIA has endorsed James for governor because of his stance on the tax, Marijuana Moment reported.

Criticism of DeBoyer's record

Not everyone sees DeBoyer as an ally of the industry. Sen. Jeff Irwin (D) recently told Marijuana Moment that James "has not been a friend to legalization," citing James's 2018 comments that he would "personally be voting no" on the ballot initiative that legalized recreational marijuana in Michigan, and argued that DeBoyer "has been even worse on cannabis issues," the outlet reported.

Marijuana Moment noted that DeBoyer filed legislation this session that would cut the number of plants Michigan medical marijuana caregivers can grow for patients in half, from 12 to six, and limit caregiver registrations to one per physical address.

How the tax has performed

The 24% wholesale tax took effect Jan. 1, 2026, as part of a road funding package Gov. Gretchen Whitmer (D) signed in October 2025, The Marijuana Herald reported Oct. 26. It sits on top of the existing 10% retail excise tax and 6% sales tax, the Herald reported.

State officials projected the tax would raise about $420 million a year for road repairs and construction, according to Marijuana Moment. Cannabis Business Times reported Oct. 26 that a 2025 fiscal analysis put the figure at $420.7 million a year, but that the tax brought in $73.4 million in the first six months of 2026, about 35% of what it should have generated, according to the Michigan State Budget Office.

The tax has also been challenged in court through lawsuits filed by the cannabis industry, Marijuana Moment reported.

Other bills aimed at the tax

House Bill 6440 is a temporary pause. Other pending bills would go further:

• House Bill 6224, introduced in July by Rep. James DeSana (R), would repeal the Comprehensive Road Funding Tax Act, The Marijuana Herald reported. DeSana says the tax is generating less than half of what supporters anticipated, according to Marijuana Moment.
• Senate Bill 810, filed by eight bipartisan senators, would also repeal the act. It was referred to the Senate Government Operations Committee in late February and had not received a hearing as of Oct. 26, Cannabis Business Times reported.

Where the governor's race stands

James, DeBoyer's running mate, said in his "Freedom Agenda" in August that the tax "drives up prices, gives illegal operators a competitive edge, and has already fallen far short of revenue projections," and pledged: "As Governor, I will work to repeal or sharply reduce it," Marijuana Moment reported.

Democratic nominee Jocelyn Benson has not taken a clear stance. She has called the tax a "new and emerging issue." "There's a lot of data yet to be determined on that particular tax… We need to know where the money is going and also the impact that it's had on the industry," Benson said, according to Marijuana Moment. "At the same time, I want to make sure that any changes we are making to our tax code do not come at the expense of driving up costs for Michiganders."

What to watch

The bill now sits in the House Appropriations Committee. To take effect, it would need committee action, passage by both the House and Senate, and the governor's signature. Michigan voters choose a new governor on Nov. 3. Until any change becomes law, the 24% wholesale tax remains in effect.

This article is general information, not tax or legal advice.