Compared with other states, Michigan's tax burden is low - and getting lower

Don’t believe us? Check out the Michigan Tax Time Machine.

Turn the clock back to 1977. Michigan manufacturing jobs were plentiful. Wages were high. So were taxes. Back then, Michigan had the 13th highest per capita tax burden in the nation. State and local taxes in 1977 were $261 (or 9 percent) higher than the national average.

By 2014, Michigan’s per capita tax burden was $900 (or 19 percent) below the national average. State and local taxes as a percentage of personal income were 16 percent below the national average.

It may not seem like it (for reasons we’ll show later), but Michigan’s total tax burden is now among the lowest in the nation. Thirty-four states have higher tax per capita and higher taxes as a percentage of personal income.  

Want more details? See our “Michigan Tax Burden Trends” chart below, and our methodology.

Michigan Tax Burden Trends

Source: Tax Policy Center data, downloadable here:

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John Saari
Tue, 05/09/2017 - 9:30am

In a successful civilization we do not let anyone lack in food, housing, healthcare, and education. We that can afford it must pay for it. No country produces more than the USA. Those that produce the most should be the richest and pay the most in taxes.

Richard Cole
Tue, 05/09/2017 - 10:14am

The work of the Bridge team continues to amaze, impress and inspire me. It makes my voluntary subscription fee feel like a pittance compared to the tremendous value you add to my life. Thanks again.

Paul DuBois
Tue, 05/09/2017 - 1:19pm

The real question to me is not our tax rate or where we place compared to other states. The real question is what do we get for those taxes? If we have low taxes and lousy schools terrible roads, a lack of parks and scant law enforcement what is the point?

Craig Ellis
Wed, 05/10/2017 - 8:48am

This analysis is flawed by two issues. First, you do not account for currency devaluation between 1977 and 2014. In 1968, a very nice car cost $3500. In 1978, that same car cost $12,000. Over the following 20 years, Michigan went from principally a single-breadwinner state to a dual-breadwinner state in order to survive the loss in purchasing power. Second, BECAUSE of the transfer of wealth from private to public via devaluation, capital sought other national and global locations to engage in production. Michigan lost jobs and population at a staggering rate although government spending at state and local levels NEVER declined. Despite your assertions, overall tax burden climbed to cover the spending. License fees, deduction reversion, and relentless property tax valuation increases combined to draw an ever greater proportion of wealth out of private hands. Finally, THE issue with all government spending at all levels is that it is 100% consumption; none is "investment" spending that produces a return in future years.

Your analysis is neither scholarly or thoughtful. I don't know the point of it, but it certainly does not help Michiganders understand why the state fails to prosper.

Robert J. Kleine
Mon, 05/15/2017 - 9:29am

First, it is not true that all government spending is consumption. Spending on infrastructure such as the interstate highway system, airports, water and sewer, etc. are necessary for economic growth. Also, research and development spending provides benefits for the private sector. The internet came from research done by the Department of Defense. You need to read to read Felix Rohatyn's book, Bold Endeavors: How Our Government Built America, and Why It Must Rebuild Now.
Second, the best way to measure the tax burden is as a share of personal income. In 1978 state taxes were about 9.5% of personal income, today they are about 6.5%. Michigan has the lowest state and local taxes in the Great Lakes region. We also have the worst roads, poorest education system, sixth highest college tuition in the nation, more local governments in fiscal distress than any state, and second lowest per capita income in the region.