The committee and several supportive labor unions argue the issue is about creating a fair tax structure. But some opposing business advocates say it could “devastate” the state’s economy.
For example, Rob FOWLER, president and CEO of the Small Business Association of Michigan (SBAM), said in a statement today, “It’s undeniable that if you raise taxes on Michigan companies, especially those that compete with businesses in other states, it will be bad for our citizens and our economy.”
The Michigan Chamber of Commerce said it stronger, stating the proposed corporate tax hike would “take a wrecking ball to the state’s economic competiveness,” while the Michigan Republican Party said it “would send Michigan businesses packing and out of state.”
Right now, the Michigan Labor District Council, the Operating Engineers and the Michigan Regional Council of Carpenters and Millwrights are backing the proposal. But the committee is trying to get more organizations on board.
The ballot committee argues the 2011 shift from the Michigan Business Tax to the CIT was tantamount to massive tax cuts for large corporations and increases for middle class and working families.
Lutz said during the press conference that the committee would like to use the extra $900 million in state revenue, which would result from the CIT hike, to pave the roads without cutting the earned income tax credit (EITC). But the group stresses that forging a fair tax structure is the driving force behind the initiative.
According to the new ballot committee, state revenue from corporations totaled $2.1 billion in 2011. By 2014 that number fell to $419 million. The committee considers the drop an inequity when compared to the $6.4 billion in 2011 state revenue from the individual income tax, which jumped to $8 billion by 2014, according to the group.
The ballot proposal, the committee said, “is simple.”
“Corporations received over $2 billion in unfair and unjustifiable tax giveaways that didn’t work,” the committee’s website said. “Our plan would recoup about half of those cuts – nearly $900 million – and put the money into our crumbling roads and bridges by raising the corporate income tax from its all-time low of 6 percent to 11 percent. Small businesses would not be impacted.”
Callie MELTON, a mother of two who spoke at the committee’s press conference today, said she thinks it’s an outrage that corporations get tax breaks while she struggles to pay her mortgage.
“It’s a stark reality that the job market is less stable,” she said, while she has to deal with “economic insecurity” because the elimination of the Michigan Business Tax “has not yet materialized” into more and better jobs.
“Corporations profit off the use of our roads and they should help pay for them, not just people like me who are struggling to pay the mortgage and provide for my family,” she said in a statement.
But Charlie OWENS, state director for the National Federation of Independent Business (NFIB), and other business advocates are highly critical.
Owens said he thinks the plan would bring us back to the “(former Gov. Jennifer) GRANHOLM days,” a point echoed by the Michigan Republican Party’s statement.
“I went to their website, and it’s just another attempt to use class warfare as a front to raise taxes on those who provide the jobs in our state, which is business,” Owens said. “We just came out of a decade of this kind of tax policy, and we’re finally turning the corner with personal incomes rising and unemployment declining.
“If you’re pining for the Granholm days, this is a great way to get here quickly,” Owens said.
He said the “real danger” of the plan is that it would stall capital growth as business owners cap the growth of their enterprise in an attempt to avoid tax hikes.
And as that happens, Owens said it could ultimately lead to job losses. Owens said expanding Michigan businesses would end up placing their capital elsewhere, and with it, new job opportunities.
Citizens for Fair Taxes held press conferences in Southfield, Lansing and Flint today.
“Michigan receives more revenue from cigarette smokers and drinkers than corporations,” Lutz said today, adding later, “Working people in Michigan are ready to stand up and say corporations, not just families, are going to pay their fair share.”
Northern MI Chamber Alliance 