Proposed Excise Tax on Water Bottlers Could Open Door to Water Rights Battles; Chamber Strongly Opposed

October 23, 2017

Last week, legislation was introduced that would impose a 5-cent-per-gallon excise tax on water bottlers. Not only would such a tax increase the cost of doing business in Michigan, it would also turn longstanding property rights policy on its head.  

Under House Bill 5133 (Lucido, R-Shelby Township), anyone with a permit to bottle water in this state has just been targeted. In fact, recent news report indicate some companies could see their tax liability increase in excess of $20 million. Even worse, House Bill 5133 as drafted would change over a 100 years of precedent on Michigan’s water policy by making water a taxable commodity that could be bought and sold. Making water a commodity would open the door for legal challenges to water rights in Michigan. One judicial decision could bring about a host of bad ideas that would negatively affect every water user and could open the door for diversion of Great Lakes water.  

The bill sponsors’ misguided goal to raise a few more dollars off the backs of water bottlers could cost Michigan 18,000 jobs, almost $4 billion in economic activity and, worst of all, could eliminate the water rights of every property owner in the state. The Michigan Chamber is strongly opposed to this harmful, job-killing legislation. 

For more information, please contact Jason Geer, Director of Energy & Environmental Policy at jgeer@michamber.com or Dan Papineau, Director of Tax Policy at dpapineau@michamber.com.