Legislation to Eliminate the State Income Tax?

[ABetterDetroit]

Not so sure that brick and mortar retail is healthy enough to make up a 9 Billion dollar hole in the state budget though I will agree that the current personal tax system in this state has gone off the edge of a cliff here making it not one of the most desirable states to live in compared to many others.

My choice would be a hard look at property tax relief since that is the first thing that is always thrown at virtually any employer that is willing to make a capital investment in Michigan.

I'm curious which tax everyone else thinks is the most prohibitive tax in this state to growth? Not as much about the far right or far left but the people who are more in the middle. "All of them" or "Tax corporations more" wouldn't be as interesting of a discussion.

http://www.detroitnews.com/story/new...nate/96245982/

[313WX]

It's a stupid proposal.

Look no further than Kansas and Louisiana to see what would happen here.

Places like Florida and Nevada make the loss revenue with tourism. Michigan simply doesn't have nearly the volume of tourism as those places. Meanwhile, places like Texas make up for it with a recession-proof industry [[again, something Michigan doesn't have).

Lastly, would the people in Michigan also be willing to make the loss revenue with higher property taxes and toll roads as well? Because that's what they do in every other non-income tax state that's not Kansas or Louisiana.

And I'm not even going to get into the burden this would make on the state's most vulnerable citizens who must spend a larger share of their income on consumer goods more frequently [[the poor). BTW, food and drug products are also not exempt from sales taxes in these other non-income tax states [[unlike in Michigan).

[JBMcB]

Most economists, left and right leaning, agree that income taxes are a bad idea.

The debate comes in how to replace it. Most VAT/sales tax-style proposals include a reverse tax for low income individuals - basically a "prefund" check to make up for the sales tax.

[Ray1936]

Michigan could save millions by firing the State Legislature. All those full time people doing nothing all year long? What a joke. My adopted home of Nevada has a State Legislature that meets once every two years for four months. And, by golly, it works!

[313WX]

Michigan could save millions by firing the State Legislature. All those full time people doing nothing all year long? What a joke. My adopted home of Nevada has a State Legislature that meets once every two years for four months. And, by golly, it works!

I'm in complete agreement there.

[K-slice]

If it's a tax plan put forward by Republicans you can bet its just a wealth redistribution ploy. And not taking from the wealthy and giving to the poor mind you...

Snyder already gave his b/millionaire buddies businesses a huge tax break, now they want to make sure the b/millionares pay a lower % of their income in taxes than the janitors who clean their offices. Brilliant!

[Bham1982]

Most economists, left and right leaning, agree that income taxes are a bad idea.

Um, what? Since when? Name these "most economists".

User fees are the most regressive way to tax people. Unfortunately, we keep slouching further and further towards a user fee society. Sales taxes, car fees, gas taxes, etc. are all being raised, harming the poor and working class, as income taxes and corporate taxes are slashed, benefiting the wealthy.

It's already ridiculous that we have a flat income tax, but the legislature wants to make it even sillier by eliminating any income tax. Why not just eliminate any pretense and just admit our legislature is a vehicle for further enriching the 1% at the expense of everyone else.

[Bham1982]

Michigan could save millions by firing the State Legislature. All those full time people doing nothing all year long? What a joke. My adopted home of Nevada has a State Legislature that meets once every two years for four months. And, by golly, it works!

Yes. State Legislature is worse than useless. The less they meet, the better.

[davewindsor]

Boy, do I hate living in Canada when I hear this. We already have some of the highest income taxes in Ontario and you guys are significantly reducing yours. The province raised our gas taxes another 16 cents a gallon this year. Your sales tax is just 6% where ours is over 13%. I bought a TV on sale on Black Friday at Walmart for $199 that came to $250 after sales tax and eco fee [[which makes it a 25% sales tax). Ontario has the highest electricity rates in North America. Another 4.3cent/cm tax increase on natural gas. GM announced today they are moving production of the GMC Terrain Denali from Ingersoll to a new $5 Billion dollar plant in Mexico because it's much cheaper [[we already lost Camaro in Oshawa to Lansing, Michigan in November costing 1,000 jobs). In a few years, GM won't have a footprint in Ontario anymore. Whatever is left of our manufacturing is going to be lost to Michigan and Mexico.

Yet, people keep voting for tax and spend liberals in Canada.

WHY?!

[archfan]

Michigan could save millions by firing the State Legislature. All those full time people doing nothing all year long? What a joke. My adopted home of Nevada has a State Legislature that meets once every two years for four months. And, by golly, it works!

Oh, if only they really did nothing all year!

[emu steve]

Most economists, left and right leaning, agree that income taxes are a bad idea.

The debate comes in how to replace it. Most VAT/sales tax-style proposals include a reverse tax for low income individuals - basically a "prefund" check to make up for the sales tax.

That's news to me...

To be fair to you, would you text say Paul Krugman, liberal economist, and see if he agrees with you.

If he agrees with you, you can make your case, I'd think.

[Bham1982]

Yet, people keep voting for tax and spend liberals in Canada.

WHY?!

Probably because most Canadians don't mind paying high[[er) taxes if it results in meaningful improvements in their lives and the lives of others?

I have no problem with higher income taxes. Raise them, please. I would like Michigan to be more like California or New York, not Mississippi or West Virginia. Just be sure revenues go for useful stuff.

[casscorridor]

The state of Michigan needs restructuring, of its government, tax system, and relationships between cities, townships, counties, etc

Don't expect the current government to do anything good though. They have already done enough damage to this state for one generation.

[Zozo]

The current Michigan sales tax is 6%. That is six cents for every dollar spent. A sales tax raise could only be a few more cents, as the highest state sales tax is Tennessee, at nearly ten cents per dollar.

Nine cents per dollar is quite affordable, and it's unreasonable to assume "poor people" can't afford three more cents per dollar. It's probably more reasonable to assume that "poor people", or low wage earners, are the most hurt by the 4.25% income tax. If we want to help "poor people", why don't we let them keep more of the money they earn? After all, what gets people out of poverty faster than... money?

Furthermore, if it were the case that "poor people" can't afford nine paltry cents per dollar, should the middle class then have to immediately forfeit 4.25% of their income? That does not seem fair.

Lastly, Michigan politicians have not proved themselves to be good stewards of our tax dollars. Ever. And we are simply foolish to keep giving them more and more of our money.

[1953]

My first reaction to the news that we might roll back our income tax altogether was one of disbelief. With infrastructure and cities as badly funded as they are these days, I can't imagine how we would close the gap. As Bham said, I'd rather pay more, and live in a well-run state with top notch services, then join the national race to the bottom.

[Bham1982]

Nine cents per dollar is quite affordable, and it's unreasonable to assume "poor people" can't afford three more cents per dollar.

A 50% increase in sales tax is "reasonable" to you? Especially when the poor are the most harmed by sales tax increases? Rich people don't care about sales tax; their assets are deployed in investments and consumer spending generally not subject to sales tax. Nose jobs and airplane tickets to Paris and lavish home renovations don't come with sales tax.

It's probably more reasonable to assume that "poor people", or low wage earners, are the most hurt by the 4.25% income tax.

Poor people don't pay income tax. So eliminating income tax would do nothing for the poor. Working class people are harmed by our current flat tax, and that can easily be fixed by moving to a graduated tax like most progressive states.

If we want to help "poor people", why don't we let them keep more of the money they earn? After all, what gets people out of poverty faster than... money?

Great idea. I assume you support reversing the huge corporate tax cuts of recent years, correct? And you also support rolling back the higher gas tax and higher vehicle registration fees? These, alongside sales taxes, are the fees that harm the poor.

[jiminnm]

The current Michigan sales tax is 6%. That is six cents for every dollar spent. A sales tax raise could only be a few more cents, as the highest state sales tax is Tennessee, at nearly ten cents per dollar.

Tennessee has no income tax [[except they do tax dividend and interest income over $1,250 single /$2,500 joint at 6%).

[JBMcB]

That's news to me...

To be fair to you, would you text say Paul Krugman, liberal economist, and see if he agrees with you.

Here's a poll of five economists from across the political spectrum:

http://www.npr.org/sections/money/20...nomic-platform

If you want to talk Krugman, I'm assuming you're against "living wages" as well, as he certainly is.

[313WX]

Here's a poll of five economists from across the political spectrum:

http://www.npr.org/sections/money/20...nomic-platform

If you want to talk Krugman, I'm assuming you're against "living wages" as well, as he certainly is.

Between Krugman's views on Unfai...I mean Free Trade and the way he behaved this past election, he's lost a lot of credibility with me.

And I say that as a liberal myself.

[renf]

What about reducing the sales tax rate but ending the exclusions? Right now we pay no sales taxes on such things as services, medical expenses, stocks, bonds and tuition. And the sales tax on buying a home or property is only 0.75%.

[KJ5]

The current Michigan sales tax is 6%. That is six cents for every dollar spent. A sales tax raise could only be a few more cents, as the highest state sales tax is Tennessee, at nearly ten cents per dollar.

Nine cents per dollar is quite affordable, and it's unreasonable to assume "poor people" can't affornd three more cents per dollar. It's probably more reasonable to assume that "poor people", or low wage earners, are the most hurt by the 4.25% income tax. If we want to help "poor people", why don't we let them keep more of the money they earn? After all, what gets people out of poverty faster than... money?

Furthermore, if it were the case that "poor people" can't afford nine paltry cents per dollar, should the middle class then have to immediately forfeit 4.25% of their income? That does not seem fair.

Lastly, Michigan politicians have not proved themselves to be good stewards of our tax dollars. Ever. And we are simply foolish to keep giving them more and more of our money.

I'm guessing from the condescending and gratuitous use of quotes that this is all conjecture and you're not "poor" yourself.

[Towne Cluber]

A 50% increase in sales tax is "reasonable" to you? Especially when the poor are the most harmed by sales tax increases? Rich people don't care about sales tax; their assets are deployed in investments and consumer spending generally not subject to sales tax. Nose jobs and airplane tickets to Paris and lavish home renovations don't come with sales tax.

Surely you know that rich people don't actually pay for airplane tickets. They use credit card points and frequent flier miles.

[Zozo]

Bham, I don't think you have demonstrated how a higher sales tax hurts low wage earners. A 50% raise in sales tax is very reasonable when that 50% equals a mere three cents. A minimum wage earner at $8.90 an hour makes three cents like every five seconds or something like that. It is just not possible for three extra pennies on a purchase to hurt anyone.

Go interview someone who has spent their life working in a low wage industry and ask them if they would rather pay three extra cents for every dollar they spend, or eliminate money being taken directly out of their paycheck for income tax. They will choose to have a larger paycheck every time. Or will they choose the Bham tax plan?

Maybe some rich people have spending habits that are excluded from the sales tax. Poor people also have underground economies where they don't pay taxes on the goods they buy. And I'm not referring to illegal drugs. Maybe rich people make lots of purchases where they don't care about sales tax. So what? It doesn't follow that a nine cent sales tax hurts poor people.

Nine cents is just the hypothetical sales tax increase for purpose of this thread. What if it was only a two cent increase, to six cents?

I'm all for restructuring these mega tax breaks Michigan corporations receive. And no tax breaks or sweet heart deals for stadia. In October of 2016, Tom Gores purchased a $100 MILLION dollar home in LA. In November of 2016 he shows up in Detroit, announces the Pistons will move downtown, that this move will be so great for his business, and then brings out his hat and says he needs $35 million to facilitate the move. Somehow the City of Detroit legal team always gets played for fools by these sports gangsters and their much more clever attorneys. And we are all paying more, not just poor people, because these very rich people are getting sweet heart deals that we would never get.

KJ5, I'm not trying to be insulting to "poor" people. My issue is how is this term "poor" defined? Even the poorest Detroiters are much more wealthy than the absolute majority of the world. If you are poor in Detroit you are richer than 99% of the world, and indeed you are the 1%. To call people "poor" when they have so much is self defeating and [[for the most part) it's not true.

[313WX]

I'm guessing from the condescending and gratuitous use of quotes that this is all conjecture and you're not "poor" yourself.

You may be right.

[emu steve]

Here's a poll of five economists from across the political spectrum:

http://www.npr.org/sections/money/20...nomic-platform

If you want to talk Krugman, I'm assuming you're against "living wages" as well, as he certainly is.

Could you do us a favor and name the five economists.

Thanks.

Need to be careful about ascribing too much to a person with a 'label.'

For example, Senator Mancine [[D-W.V.) who because his state is so conservative, isn't hardly a Dem at all.