FOX 2 – A hearing in court could determine whether a 24% tax on cannabis will help raise the $420 million to fix the roads.

The backstory:

A pro-cannabis group is pushing back on that proposed tax on the industry which has already been baked into the new state budget.

The judge is being asked to halt the 24% tax on marijuana that starts January 1. Arguments were heard for two hours today, but no ruling has been given yet with the clock ticking.

The marijuana advocates say that since the people brought the law to allow the legalization of pot with its 10% tax, an additional tax needs a 3/4 vote of the legislature because the citizens voted to legalize marijuana.

The state has argued that it is a big money business and that road funding will generate $420 million for Michigan  legalization and taxing are two different statutes

“If you took 24% out of our top line, we are not profitable,” said Tim Schuler, president and CRO of Cannalicious Labs.

“We have been told that if this wholesale tax goes through, cannabis companies will be forced to close,” said Rose Tantraphol, Michigan Cannabis Industry Association.

FOX 2: You are focusing on the fact that jobs would be lost. (The other side) said it was speculative.”

“It’s not speculative,” Schuler said. “We own and operate a company that has 60 employees. We’re in a tough spot if we have to absorb 24% and that’s the most egregious tax that we’ve ever seen against any business.”

It comes down to an issue of fairness, they said.

“When this happened in the middle of the night, this Trojan horse tactic to ram this unconstitutional wholesale tax through, that was a sign that our industry was being unfairly targeted,” said Tantraphol.