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Personal Property Tax phase out being rushed through state Legislature

Michigan Municipal League

A plan to phase out Michigan’s Personal Property Tax—the tax on business equipment—is being rushed through the Michigan Legislature.

There are unanswered questions and not much time to get answers.

Businesses want to end the tax on equipment. The problem is many local governments rely heavily on that tax.

When a proposal was announced last week, it appeared phasing out the tax over ten years and a statewide vote to replace it with the state’s current use-tax revenue might work to replace the local governments’ lost revenues.

Samantha Harkins is with the Michigan Municipal League. She said legislators are asking a lot of questions during hearings this week and not always getting answers.

“I would say we’re very uncomfortable to be honest with you. We got the formulas for reimbursement late on Friday. We’ve had several communities running those numbers and for right now the numbers are not working out like they thought they would. There may be some tweaks that are needed for the formula. I don’t know. But at this point, that’s a big ‘what if,’” Harkins said.

But the legislative committees intend to rush the bills to the full chambers sometime this week.

Lester Graham reports for The Environment Report. He has reported on public policy, politics, and issues regarding race and gender inequity. He was previously with The Environment Report at Michigan Radio from 1998-2010.
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