Legislative Priorities-Budget and Tax Policy

• Eliminating the personal property tax for all taxpayers.

• Protecting the new personal property tax relief contained in the MBT by opposing efforts by the state and assessors to re-classify property for all taxpayers.

• Local units of government should provide the maximum amount of notice possible when mailing assessment notices to property owners and the Board of Review should provide for hearings each week during the statutory time period allowed.

• Preserving, protecting and expanding upon the reforms of Proposal A and the Headlee Amendment, and opposing measures that circumvent the intent of these voter-approved tax limitation amendments.

• Providing taxpayers with the same right granted to the Department of Treasury to appeal property classification to court.

• Eliminating the 2009 sunset for certain “qualified errors” to be eligible for review by the July and December Boards of Review.

• Expanding the term “qualified error” eligible for review by the July or December Boards of Review to include property classification.

Michigan must continue to make personal property tax relief a priority. This tax on business machinery and equipment, furnishings, and office equipment is an administrative burden and a disincentive to capital investment, job retention and job creation.

Proposal A has been largely successful in its two fundamental goals: reducing out-of-control property taxes for school operating purposes; and narrowing the gap between low and high spending school districts. However, Michigan’s property tax burden remains high compared to other states. Michigan must not return to double-digit property tax increases by changing or circumventing the intent of Proposal A or the Headlee Amendment. Furthermore, the Headlee Blue Ribbon Commission examined the misuse of special assessments and recommended many of them be subject to various taxpayer protections.  

• Opposing any further increase in the sales, use and excise tax rates on goods and services currently subject to tax.

• Opposing the levying of sales, use or excise taxes by any local tax jurisdiction.

• Opposing the levying of sales, use or excise taxes on any goods or services not currently subject to tax.

• Legislation or administrative action to resolve numerous problems with implementation of the Streamlined Sales and Use Tax Agreement and unreasonable audit practices.

• Opposing efforts by the Michigan Department of Treasury to transition Michigan from a “vendor liability” state into a “consumer’s liability” state.

• Supporting administrative or legislative changes to allow taxpayers to obtain refunds of overpaid sales tax from the state.

WHY?

Michigan’s sales tax continues to provide a substantial source of revenue to state government, especially since voters approved a 50 percent increase in the Michigan sales tax rate as part of Proposal A. The Michigan Chamber strongly believes that any increase in the sales tax rate, expansion of sales tax to services, or allowing local jurisdictions to levy sales, use or excise taxes, will hurt our state’s economic competitiveness, encouraging individuals and job providers to purchase goods and services outside of Michigan. Furthermore, Michigan’s entry into the Streamlined Sales and Use Tax Agreement must be continually monitored to ensure Michigan’s deductions, exemptions and operational framework are not sacrificed in the name of nationwide uniformity and simplification.

• Opposing retroactive tax increases resulting from law changes, changes in policy or court decisions.

• Supporting a provision for interest to be paid on overpayments in the same manner and at the same rate as interest is currently assessed on underpayments.

• Eliminating the requirement that taxpayers must pre-pay disputed non-property taxes if they are seeking redress in the Court of Claims.

• Improving taxpayer access to the Department of Treasury policies and rules that generally communicate policy and statutory interpretations and opportunities for interactive dialogue between Treasury and taxpayer advisory groups.

• Opposing the use of third-party auditors, whether flat fee or contingent fee. The use of these types of auditors presents a conflict of interest, poses serious questions of confidentiality, due process and equal protection under law.

• Allowing taxpayers and Treasury to settle, negotiate and compromise tax disputes, including, but not limited to, mistakes, errors and omissions, at the administrative level with appropriate safeguards prior to going to court.

• Advocating legislation to clarify Michigan’s statute of limitations.

WHY?