Look around: YOUR taxes could be much higher

Nationwide, three taxes – income, property, and sales – account for more than 90 percent of all state and local tax revenue. Compared with other states, Michigan is pretty taxpayer friendly:


HOW MICHIGAN'S MAJOR TAXES COMPARE ACROSS ALL 50 STATES

MICHIGAN'S RANK (#1 being the most competitive)

  • Corporate taxes: 8th
  • Income taxes: 14th
  • Sales taxes: 9th
  • Property taxes: 25th

Source: Tax Foundation "2017 State Business Tax Climate Index"


Now, look at Michigan’s least competitive performance in those rankings – property taxes. Nearly a quarter-century ago, Michigan arrested rapidly rising property taxes which were literally pricing some people out of their homes. By approving Proposal A in 1994, Michigan voters shifted some tax burden to sales taxes and capped future increases in property taxes.

Michigan residents lost billions of dollars in property value in the Great Recession. As property values plunged, property taxes also dropped. But as property values recover, property tax increases are capped at 5 percent or the rate of inflation, whichever is less. That leaves property tax revenues flowing into state and local coffers far below pre-Great Recession levels. Effectively, Michigan residents are paying 11 percent less in property taxes now than they were before the Great Recession:


MICHIGAN'S RECENT PROPERTY TAX "CUT"

Total State/Local Property Taxes in Michigan

  • 2004: $15.1 billion
  • 2014: $13.2 billion
  • Change: -13%

State Population

  • 2004: 10.06 million
  • 2014: 9.91 million

Property Tax Revenues per State Resident

  • 2004: $1,504
  • 2014: $1,335
  • Change: -11%

Source: Census Bureau State & Local Govt Finance Data

Tax figures presented in inflation-adjusted 2014 dollars.​


NEXT: State government gives more tax breaks than it collects for schools and general government

Comment Form

Add new comment

Plain text

  • No HTML tags allowed.
  • Web page addresses and e-mail addresses turn into links automatically.
  • Lines and paragraphs break automatically.

Comments

Rich
Tue, 05/09/2017 - 11:31am

The most unfair tax of all is the property tax on non-homestead, non-commercial buildings, or in other words, that vacation house on an up-north lake, or that second place in snowbird country that is called home. And just why is it unfair? It is TAXATION WITHOUT REPRESENTATION. Granted, a person should not be allowed to vote in two different places in the same election. But a person should be allowed to vote for any proposal that would affect what he or she pays in tax or assessments. With today's technology, it is possible to customize a ballot for each address. We already do it as my local school district serves residents in parts of 3 counties and at least 5 cities / townships. To deny a person to vote on a tax that affects that person is exactly why we started a skirmish in 1776.