Instead of a tax cut that everyone else received, the big guys were tagged with a defacto tax increase. They muttered about it but were told to be patient.
So they’ve been waiting on the sidelines for their turn and that is at hand with a proposed repeal of the personal property tax (PPT) on business equipment.
The governor has hatched a new deal to grant tax relief for the manufacturers while at the same time restoring money to local governments that deeply rely on the PPT to fund their firefighters, cops and other essential services.
The repeal of the PPT costs locals $800 million and some loose change, so you can see why they are worried.
Already whacked by the loss of state revenue sharing and declining local property tax collections, another $800 million hit is the equivalent of Hurricane Sandy hitting the mitten-state.
The governor’s solution is to re-allocate (a.k.a. steal) 1.5% of the money collected on the state use tax, which is basically a tax on business equipment that comes in over state lines.
The revenue would repay about 90% of what the cities and townships lose.
The locals were worried that in order to receive the payback, they would have to beg the legislature every year to do it.
With the turnover in those ranks, there was no guarantee that future salons might help.
Solution: The governor would create an entity outside of government to be a pass through vehicle through which the locals get their money without a legislative vote.
While that sounds good, future lawmakers could change that down the road after this governor leaves or even before.
The locals were worried that in order to receive the payback, they would have to beg the legislature every year to do it.
Plus you’ll likely have some push back from those who now get the 1.5% of the use tax and don't want to share it with anybody else.
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