It actually started off as a MI Supreme Court Case [[Dooley v. City of Detroit) which was eventually made into the public law you cited after the newly re-written Michigan Constitution forbad it.
Your right, people can lobby to change this. But given the fact that 22 Michigan cities imposed income taxes on their non-residents, and most of the states population resides in cities, I don't need my Magic 8-Ball to tell you the final outcome.
With the number of Michigan homes under-water, government is not going to be giving up any revenue sources in the foreseeable future.
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