The Truth Behind The Michigan Sales Tax Increase Plus Gas Tax Increase

Yes they really think that we are this stupid and yes they really do think they have the  deal in the bag.  We are talking about our Lansing lawmakers and the "sales tax proposal" set for a vote in May.   There is a reason why the proposal was set to a May vote, May historically has the lowest turn out of voters and you can be certain that the greedy lawmakers and their special interests will get their people to the polls. 

The lawmakers are already counting on this proposal passing, so much so that they have already unveiled an $88 million plus plan to create underground parking and an underground tunnel so they can get to their offices by perhaps avoiding their constituents on the outside?

 This planned welcome center will provide a better and more secure way for visitors to enter the building," Carol Viventi, co-chair of the commission, said in a news release.  In reality it is a more secure way for lawmakers to avoid their constituents is what many believe.

Officials could break ground on the project as early as this

summer.

The work can be funded now thanks to a new, $3 million annual budget established this year for Capitol renovations and upkeep.   

Where did the extra $3 billion come from in this budget?  Why wasn't it applied to the roads?

The lawmakers tell us that is just a 1cent sales hike in the sales tax but the truth is it is a $1.7 billion tax-hike scheme (1) that we’re supposed to believe will help fix the roads. The plan, which requires voter approval in May, includes:

• 16% increase in the state sales tax
• 23 cents-per-gallon hike in gas taxes
• $95 million more in registration taxes
• $60 million in Internet sales taxes

Also gas taxes can be increased on an annual basis now, if this proposal passes, to keep up with inflation! 

In addition to a mishmash of tax hikes, the package includes giveaways that have nothing to do with fixing our roads–from mass transit to welfare-style government assistance to contracting preferences for a “disadvantaged business enterprise.”

TAX HIKES

$1.2 billion gas tax hike

Michigan drivers will pay 23 cents-per-gallon more in gas taxes. That would put Michigan in the top five states with the highest gas taxes and give us the highest gasoline excise tax in the nation. Over time, as the price of gas rises, that tax will go up automatically–without a vote of the legislature or input from taxpayers. (3)

$1.34 billion sales tax hike

Lawmakers voted to put a 16% hike in the state sales tax on the Michigan ballot. If approved, the rate would rise from 6% to 7%, including on Internet sales. (Lawmakers voted on separate bills to force Internet sales tax collections.) (4)

$95 million registration “fee” tax hike

Michigan drivers will also pay $95 million more in registration “fees.” Long-term, this tax hike is expected to total $210 million.

GIVEAWAYS

In order to buy enough votes to get the proposal passed through the legislature, the package was loaded up with giveaways that have nothing to do with roads:

$260 million welfare-style EITC assistance

The Earned Income Tax Credit resembles direct government assistance, such as welfare and food stamps, more than a tax credit. Filers who pay out nothing in income taxes still get money back from the government under this program. (5)

$300 million more for education establishment

Over the past four years, spending on education has increased by more than $1 billion. (6) This “deal” guarantees even more money for the public school apparatus, even though Michigan is one of 21 states that employs more non-teaching staff than teachers. (7)

$130 million more for mass transit

Instead of dedicating all new revenue to roads, the package hands mass transit programs another $130 million, a move that was viewed as necessary to buy support from Detroit-area politicians who favor bigger-government.

We need your help educating friends, family members and co-workers about this disastrous plan.

SOURCES

(1) House Fiscal Agency, Legislative Analysis Transportation Funding Package, Dec. 18, 2014

(2) House Fiscal Agency, Legislative Analysis Transportation Funding Package, Dec. 18, 2014

(3) American Petroleum Institute, Gasoline Tax, October 2014

(4) 2013-14 Senate Bill 658 and Senate Bill 659

(5) Tax or Welfare? The Administration of the Earned Income Tax Credit, UCLA Law Review, Lawrence Zelenak, 2005

(6) MEA Economist Ignores Billions in Education Spending, Capitol Confidential, May 13, 2014

(7) New Study Finds 21 State Have More Non-Teaching Staff, Friedman Foundation for Educational Choice, February 28, 2013

(8) American's For Prosperity