The President Trump-endorsed Republican gubernatorial nominee in Michigan is telling the state’s nearly $3.2 billion industry, struggling under the weight of heavy new taxes, exactly what it wants to hear.
And in return, Republican U.S. Rep. John James, who won the party’s primary last month and will face Michigan Secretary of State Jocelyn Benson in November, is collecting cash and support from Michigan marijuana operators, Bridge Michigan reported.
In spite of a prohibitionist streak demonstrated major MMJ markets such as Oklahoma and Florida – where the state GOP actively undermined two failed attempts to legalize adult-use cannabis – Republicans have made significant inroads with the cannabis industry.
That includes President Donald Trump’s endorsement of adult-use legalization in Florida as well as his December executive order that led to federal medical cannabis rescheduling.
Are Republicans or Democrats better for the Michigan cannabis industry?
In Michigan, cannabis operators were struggling due to price compression even before a new 24% wholesale tax, pitched last year by outgoing Democratic Gov. Gretchen Whitmer, took effect Jan. 1.
Since then, cannabis retailers have closed amid a reported double-digit drop in sales. Meanwhile, amid ongoing price woes amid oversupply, the state collected just $73.4 million in new tax revenue through the first six months, Bridge Michigan reported.
The tax “drives up prices, gives illegal operators a competitive edge and has already fallen far short of revenue projections,” said James, according to Bridge Michigan.
In a policy paper published on his website last month, James took aim at the tax as well as the hemp industry.
He vowed to “repeal or sharply reduce” the cannabis tax. In another sop to state-licensed cannabis operators who decry what they say is less regulated competition from hemp-derived THC, he suggested that intoxicating hemp cannabinoid products should be sold only in state-licensed marijuana stores.
“Delta-8, THCA, and synthetic cannabinoids must not be sold at gas stations or smoke shops without the same age limits, testing, and labeling required of licensed cannabis,” James’ paper states in part.
“Intoxicating products belong in the regulated market,” he added, “not next to the candy bars.”
Is the Michigan cannabis industry supporting a Republican candidate for governor?
In response, cannabis operators are supporting James.
A few weeks before James issued his tax repeal call, a fundraiser organized by executives of Jars Cannabis, a retail store chain, garnered his campaign $90,000, according to Bridge Michigan.
About 100 people attended, the news source reported.
The Michigan Cannabis Industry Association donated $1,000 to James after the campaign reached out to the trade group, Executive Director Robin Schneider told Bridge Michigan.
“We didn’t do anything,” she said, according to Bridge. “They made it clear that they support us.”
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Do Michigan Democrats want to cut a new cannabis tax?
In contrast, Schneider told Bridge her group “repeatedly” reached out to Benson, the Democratic nominee, but received no response.
For her part, Benson declined to stake out a position on the tax question earlier this week, Bridge reported.
The 24% cannabis tax, which makes Michigan marijuana some of the most heavily levied in the country, is a “new and emerging issue,” she said, according to Bridge.
“There’s a lot of data yet to be determined on that particular tax,” she added, as per Bridge. “ We need to know where the money is going and also the impact that it’s had on the industry.”
She added: “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.”
