Attached is an article in today's Detroit News about the new Single Business Tax replacement. It looks like there is support for the proposal from a variety of individuals and groups. Some concerns that have been raised is the tax INCREASE on certain sectors (finance, insurance, out of state companies), but I would like to know how this new tax level compares to other states in the region before coming to a final conclusion. 72% of businesses will see a tax DECREASE as compared to the old SBT - so that is a good thing.
Also, there is no net tax decrease for businesses in Michigan. One way to help spur economic growth (thereby increasing tax receipts) is to cut taxes. I hope our state governmental officials don't forget that.
Having worked in a split state legislature in the past, I know how difficult it is to work together and get acceptable legislation through, so I must tip my hat to the legislative leaders for offering this complex and comprehensive proposal.
Your thoughts?
Link: http://detnews.com/apps/pbcs.dll/article?AID=/20070614/POLITICS/706140408
3 comments:
I am not at all happy with the replacement of the SBT. The whole point was that the SBT was so convoluted that no one could figure it out and it consumed inordinate amouts of time that could have been spent on more productive endeavors. So here we are trying to cobble together two separate tax plans and creating yet another convoluted mess that is revenue neutral. So, what did we accomplish? Absolutely nothing! We still have a convoluted mess, no decrease in taxes overall, just different winners and losers and government picking which businesses will be the winners or losers in this taxation scheme. This flies in the face of solid conservative ideals and it defies simple economic principles. However, the people of Michigan elected a liberal House of Representatives and a socialist governor so we have exactly the kind of government we deserve. Our taxes will be higher, our jobs will be fewer, and our future will suffer.
We need to get the fair tax implemented in Michigan. To see the multiple benefits of truly fair taxation, go to www.mifairtax.org and contact your Michigan representatives and ask them to support it!!
Fair tax is an interesting idea, but are there any other states that do it? Is it tested anywhere else in the world?
The SBT was a bad tax because it kicked in when a company hit a certain number of employees, or a certain amount of profit. It wasn't that people couldn't figure it out. It was simply a bad tax which subsidized bad business decisions. (Every single tax is going to somehow influence buying and selling.)
So, resolving a convoluted mess was not the reason we repealed the SBT. It was to correct problems in the tax code.
And, if we had some kind of single, flat tax scheme right now, how long do you think it would take democrats to raise the rate if they controlled both chambers and the governorship? I'd guess sometime around Jan. 10th they'd have the budget deal in place and then spend the next 12 months figuring out how high to raise it the following year.
Our tax code is complex, sickly complex and it protects all of us and provides stability. Slow incremental change is the kind of stable environment which makes smart businessmen comfortable. Without tax stability, our state will continue to see declines in investment and we should all be happy we still have a GOP senate.
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