MI HB4842

Establishes a certification program for qualified small distillers where the Department of Agriculture and Rural Development certifies distillers using at least 40% Michigan-grown grain in their base distillate.

Reduces the gross profit markup on qualified distilled spirits from the standard 51-65% range to 32.5%, effective January 1, 2023.

Requires qualified small distillers to file annual applications by July 1 each year and maintain complete records of all grain transactions, which may be audited by the Department of Agriculture and Rural Development and the Liquor and Cannabis Regulatory Agency.

Defines qualified grain to include barley, oats, corn, potatoes, fruit, sugar beets, honey, and other cereal grains grown and harvested in Michigan.

Imposes criminal penalties of up to 1 year imprisonment and/or $3,000 fine for knowingly supplying false information about Michigan grain sourcing, plus liability for the difference in profit margins owed to the commission.