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

Bridge Michigan
Business Watch
State government gives more tax breaks than it collects for schools and general government

Who doesn’t love a tax break? In Michigan, there are tax breaks galore – $27.5 billion of them this year. Business tax breaks. Homestead tax breaks. Sales tax exemptions on items like food, prescription drugs and many services (from your accountant to your hairdresser).

Called “tax expenditures” in government parlance, these tax breaks are $7 billion more this year than they were in 2000 (after adjusting for inflation). That’s a 36-percent increase in state-mandated annual tax breaks since the beginning of the century.

Michigan gives more in tax breaks every year than it collects in tax revenue to pay for most government operations (the general fund) and schools (the school aid fund).

Tax breaks exceed ongoing revenue

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