Expanded sales tax in Granholm's new budget

Expanded sales tax in Granholm's new budget
"Some mid-Michigan municipalities and state union officials are breathing a sigh of relief that state revenue sharing cuts and massive layoffs are not part of Gov. Jennifer Granholm's proposed budget.


But local business owners are bristling over her proposal to reduce the sales tax from 6 percent to 5.5 percent, expand it to include services and use that money to bridge a funding gap in K-12 education.

Her $47.1 billion budget plan unveiled Thursday - designed to close a $1.6 billion shortfall - included her previously announced early retirement proposals for state and school employees, which aim to save $400 million.

Capturing much attention is Granholm's proposal for expanding the sales tax to most services.........Affected businesses include beauty salons, tanning parlors, printers and financial consultants.

'It may cause us (to close),' said Pam Cottom, owner of Hair Shoppe & Tanning in Lansing, which has seen business drop by 50 percent in the past year due to the economy.
'We're tottering right now.
I feel like the little guy is getting ruined.'"

Granholm is little more than an uber-lobbyist for the big teachers unions and the state employees unions.
Their annual jumps in the already out of line pay and compensation will continue.
This "fix" will only result in a bigger shortfall soon.