Recent posting in the CORE PRINCIPLES blog has rekindled my fears about the MBT, and the subsequent job destruction in Michigan. The reason for my original post on this issue “I almost threw up” seems to be finding it’s way throughout the business community. An answer would be found with the following found at the http://mifairtax.org/ site:
Petition Wording (Keep in mind this is brief and only covers main points in the Proposal)
A PROPOSAL TO AMEND THE MICHIGAN CONSTITUTION BY AMENDING SECTIONS 3, 7, 8, 10, and 11 OF ARTICLE IX, AND BY ADDING SECTIONS 43, 44, 45, 46, AND 47 TO ARTICLE IX. THE AMENDMENT IS BRIEFLY SUMMARIZED AS FOLLOWS: The Michigan Fair Tax Proposal would amend the Constitution of the State of Michigan to eliminate the Michigan Income Tax of 4.35% and the Michigan Business Tax and replaces those taxes with a 9.75% sales tax on all consumer purchases of goods and services, but does not tax business to business transactions. No other statewide tax could be restored, enacted, or the sales tax increased without a vote of the people. The state shall reimburse to every Michigan citizen’s household an amount based on the Federal Poverty Level Guidelines. This proposal would constitutionally guarantee Revenue Sharing for counties, townships, cities, and villages. If adopted, this proposal would alter or abrogate existing provisions of the Michigan Constitution.
This is a chance to bring Michigan forward. Cost of compliance in government would be reduced, business would have simpler tax calculations, and Michigan business would become competitive again. Detractors might argue retail business in the bordering communities would be hurt as we raise the sales tax, but the 3.75% difference (between Indiana and MI) would be well worth the ability to reduce paperwork, worry etc. Also, credits for lower income earners is considered in the proposal.
Lets get this movement going! Assemble legitimate petitions and get this on the ballot. Since Michigan government is unable to reduce taxpayer burden and complications, we must pick up and do the job ourselves.
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The need to get rid of the business taxes as well.
And how did they come up with the tax rate? Is that based on current spending levels? If that’s the case, they need to reconsider. It’s good to make the taxes go consumer side, however the rate needs to be watched as well so they don’t go “Oh, hey, look, a lot of money, let’s spend it!”
That rate is actually quite reasonable, considering the benefit of removing the ability of the legislature to replace the MBT in the future.