This morning, Rep Howard Walker, and Sen Jason Allen hosted a town hall meeting for discussing the new MBT at the Traverse City Chamber of Commerce. ALL were invited to present their views. Mostly attending were accountants, news outlets, and pissed off business owners.
As it turns out, judging by comments from small manufacturers and owners of business in this region, it is even clearer that we have been had. The MBT was intended to not only replace the missing revenue from the SBT which we all wanted gone, but also to shift a little burden off of manufacturers so that they would want to set-up, expand, and generally grow their businesses in Michigan. The language (believe this or not) is still being interpreted by our state’s finest accountants and the forms which are supposed to be used for the MBT are not even finalized! There are small business owners (including yours truly) who STILL HAVE NO IDEA what we are going to pay.
BIG manufacturing won… then lost. The vaguest suggestion of the reality we face, is that the MBT SHIFTED a great tax Burden to the smaller firms throughout the state. These smaller firms are finding their burdens raised similarly to that which I had mentioned before here: I almost threw up… The larger businesses who had the supposed benefit, now have new challenges, as the suppliers they rely upon will face higher costs, and will either pass them along or be forced out of business by foreign or out of state supplier’s competition. The end result is higher manufacturing costs, and lessening the ability to compete with Michigan made products all around.
The MBT was and remains a serious screw up by our state’s elected officials, and they aren’t even sure how they will next try to repair what damage has been done. The frustration could be felt as Senator Allen, and Representative Walker spoke, as they are not even sure which direction we are going. Myself and others suggested promoting the Michigan fair tax initiative, and one accountant pointed out that Florida, a recent benefactor of exiting Michigan businesses has an 8% Sales tax, which has not deterred tourism as the opponents to such law would have you think.
There are other states with higher sales taxes. There are many ways to fund “reasonable” state services, but the issue remains. What do we do about the MBT, the bastard child of late night negotiations, poor fiscal planning and a creature addicted to small business’ very life blood. We need a FAIR tax which doesn’t punish a business for setting up here. I prefer the Michigan Fair Tax, but seriously this is the end of the road for many if REAL solutions are not found.
There were some accountants speculating that they would be less a few accounts this same time next year. This was not tongue in cheek. Its the real thing. Job loss is already happening. A few business owners testified they have already had to plan on layoffs. Yes its all a bit clearer now. I understand the MBT.