LANSING, Mich. – An overwhelming majority – nearly 80 percent – of respondents to a Michigan Chamber member poll on the new Michigan Business Tax (MBT) indicated that their tax burden under the MBT, compared to the now defunct Single Business Tax (SBT), is higher. More than 30 percent of those respondents indicated their tax burden under the MBT equates to more than a 100 percent increase; eleven percent said more than 300 percent.

“We received a response from a member who operates a Michigan-based company in West Michigan that his tax burden under the new MBT is more than 1000 percent higher than under the SBT,” said Tricia Kinley, Director of Tax Policy & Economic Development for the Michigan Chamber of Commerce. “Clearly, the results of our poll indicate that the MBT and the 21.99 percent surcharge imposed on Michigan businesses, is a job killer for many companies. At the very least, the surcharge must be eliminated.”

When asked how job providers plan to react to their increased tax liability, 31 percent said they would delay or cancel wage/salary increases; 24 percent said they would delay or cancel capital investment; 15 percent said they would move or cancel Michigan location/expansion; and 14 percent said they would layoff employees. The remaining 16 percent said they would absorb the cost.

“Despite many good intentions, the MBT is already proving to be a complicated, harmful tax,” noted Kinley. “More than 60 percent of respondents said the MBT is more complicated than the SBT and 80 percent said they are now worse off. Even more compelling are the numerous comments we received from members who are now finding themselves in dire circumstances and face the possibility of closing or relocating to other states.”

"The Legislature and Administration proved earlier this year that the state can ‘afford’ to provide tax relief to Hollywood moviemakers. It’s time they provide relief for Michigan’s job providers,” concluded Kinley.

The results of this members-only poll, including member comments (unattributed), are available on the Michigan Chamber’s website at www.michamber.com. Approximately 690 Michigan Chamber members participated in this poll, which was conducted March 8 through April 28, 2008. Respondents included company presidents, CEOs, senior executives and business owners from across the state.

The Michigan Chamber of Commerce is a statewide business advocacy organization representing over 7,100 employers, trade associations and local chambers of commerce. The Michigan Chamber was established in 1959 to be a strong advocate for Michigan’s job providers in the legislative, political and legal process. 

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FOR IMMEDIATE RELEASE:                    
April 25, 2008              

Contact:  Wendy Block
Michigan Chamber of Commerce
(517) 371-7678

MICHIGAN CHAMBER OF COMMERCE OPPOSES 'BLANK CHECK HEALTHCARE BALLOT PROPOSAL

LANSING, MI - The Michigan Chamber of Commerce today announced its opposition to the state health coverage mandate that may find its way to the November 2008 ballot and constitutionally require the Legislature to design and pass a universal health care system. The Michigan Chamber cited serious concerns with the wide open and undefined language contained in the proposal and the fact that Michigan job providers and taxpayers would need to write a blank check to pay for associated costs.  

The ballot proposal currently being circulated would constitutionally require the Legislature to “pass laws to make sure that every Michigan resident has affordable and comprehensive health care coverage through a fair and cost effective financing system.”  To date, ballot circulators claim to have collected 100,000 of the 380,000 signatures needed to place the question on the November ballot.

"Although the idea of affordable and comprehensive health care for everyone is a laudable goal, this proposal will inevitably mean different things to different people because the language is extremely broad and undefined,” said Wendy Block. “For example, to some, ‘comprehensive’ may mean that they are able to access their family doctor or local emergency room but, to others, this may mean they are also able to get elective cosmetic surgery.”

“The vague wording of this proposal, if passed, will trigger years of litigation," noted Jim Holcomb, Michigan Chamber Vice President of Business Advocacy & Associate General Counsel. “As a result, the courts – not legislators – will ultimately be writing these laws and the meaning of these laws would be subject to change over time as different courts alter the meaning of the various definitions.” 

“Another major flaw of this proposal is that it fails to identify the cost of this government mandate or funding mechanism,” said Rich Studley, Executive Vice President for the Michigan Chamber. “This is really the constitutional equivalent of a blank check for health care.

“It is difficult to imagine how this ‘goal’ could be achieved under the state’s current health care financing system without a significant tax increase – or without moving Michigan in the direction of a single-payer state,” Studley added.    

“This proposal sounds nice on its surface. However, we are confident that once voters are educated about the dangers of the proposal and the negative impact it could have on their pocketbooks, they will wisely decide that it’s the wrong prescription for Michigan,” Block concluded.

The Michigan Chamber of Commerce is a statewide business advocacy organization representing over 7,100 employers, trade associations and local chambers of commerce. The Michigan Chamber was established in 1959 to be a strong advocate for Michigan’s job providers in the legislative, political and legal process. 

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