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Contact Information:
Edward S. Kisscorni, CPA
290 Suncrest Court, SW
Grandville, MI 49418

Office: 616/233-0667
Cell: 616/443-6730
Fax: 616/233-0667

Blog: www.EdKisscorni.com/Blog1
Email: Ed@EdKisscorni.com
 



 



 

 Blog 
Wednesday, December 07 2011

Personal Property Tax Repeal Seems to be Off the Table


Lieutenant Governor Brian Calley and Senator Jack Brandenburg, Chair of the Senate Finance Committee, said there is no current plan to look at eliminating the Personal Property Tax (PPT) before the end of the year.  The original plan was to eliminate the tax before year end effective in 2012. 

Calley said the administration received a lot of input and feedback from different groups on the PPT, a tax mostly industrial businesses pay on their equipment.  By and large, the proceeds go to local governments.  "There were really a lot of great ideas that were presented, a few that I hadn't thought of before, and so I guess I would describe it as tapping the brakes at the moment just so some of these new concepts or ideas could be considered." 

"It's going to be an issue that we're going to have to take some time with," Brandenburg said. "I think that's why it's been decided we'll take it up after the first of the year." 

There is major concern from local government that the loss in revenue would not be replaced.  To date there has been no guarantee that local government would be held harmless.  For this to happen, the legislature needs to find a $1 Billion source of revenue and figure out a way to get it back to local government in a fair and efficient manner.

Meanwhile, the Anderson Economic Group released an independent report concluding that doing away with the PPT in Michigan would make the state more economically competitive. 
The report found that the PPT's "high compliance costs add to the cost of doing business in Michigan in all sectors." Eliminating PPT would also eliminate some costs associated with implementing incentives offered by local and state economic development agencies to lower PPT liability and attract firms, according to the report. 

The timing of PPT reform could also be important because some businesses will see their rates increase after losing the Michigan Business Tax (MBT), but rates will still be a bit lower than they were before the MBT, according to the report. 

The study also found the PPT provides, in aggregate, 2.7 percent of total non-school local government revenue and just more than 1 percent of revenue for schools.  However, certain local governments and school districts would be disproportionately affected by elimination of the PPT. 

Posted by: Ed kisscorni AT 01:00 pm   |  Permalink   |  0 Comments  |  Email
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