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Personal Property Tax Reform Discussed At Ann Arbor Ypsilanti Regional Chamber Lunch

Tricia Kinley, Mike Johnston, Rebekah Warren
Andrew Cluley
89.1 WEMU

For years Republicans and Democrats across Michigan have raised concerns about the state’s personal property tax.  Voters in August will decide if a solution to phase-out the tax and reimburse local governments can go forward.

The issue was the topic of Monday’s Ann Arbor Ypsilanti Regional Chamber headline lunch. 

State Senator Rebekah Warren believes the plan will protect local governments from losing funds.  Warren says it’s designed to eliminate the political aspect that has at times caused problems with revenue sharing, or funds most people thought were dedicated for K-12 education being used for higher education instead.

The plan calls on a portion of Michigan’s Use Tax being dedicated to reimbursing local communities for the revenues currently raised from the Personal Property Tax.  While the Use Tax is the mechanism that local governments will be funded, the tax itself won’t increase for residents.  Instead the revenue will be raised through expiring business tax credits and a new Essential Services Assessment for businesses.

Mike Johnston of the Michigan Manufacturers Association says businesses will overall see an 80 percent decline in the tax on equipment.  He says the Essential Services Assessment will also be a single form to fill out and eliminate the complications in the Personal Property Tax.

The Michigan Chamber of Commerce’s Senior Director of Tax and Regulatory Reform Tricia Kinley describes redirecting expired business credits as a way to shift the state’s economic development strategy to one that benefits all businesses rather than select firms and industries. 

Both Johnston and Kinley are calling on local businesses to serve as leaders in getting the August ballot measure approved.  If voters across Michigan reject the plan than the phase out of the Personal Property Tax will be repealed starting in 2015.

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— Andrew Cluley is the Ann Arbor beat reporter, and anchor for 89.1 WEMU News. Contact him at 734.487.3363 or email him acluley@emich.edu.

Like many, I first came to this area when I started school at the University of Michigan, then fell in love with the community and haven’t left. After graduating from U of M in the mid 1990’s I interned at WDET for several years, while also working a variety of jobs in Ann Arbor. Then in 1999 I joined the WEMU news team.
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