One of the top items on the legislative agenda for Republicans in the Michigan House and Senate is a repeal of the personal property tax on businesses. If pass, that repeal could further decimate already strained local budgets.
A phase-out of the personal property tax is the No. 2 tax reform priority after the recent repeal of the Michigan Business Tax and is on the fall agenda, Lt. Gov. Brian Calley said Tuesday.
Michigan municipalities typically get about 11 percent of their property tax revenue from the tax on equipment such as machinery, computers and office furniture, but the impact of a repeal on some cities and townships would be much more severe.
Detroit stands to lose nearly $51 million if the tax is repealed and not replaced, while Warren would lose $11 million.
Detroit is already facing a massive deficit and is cutting services rapidly. Without a replacement for that lost revenue, that city could be forced into needing an Emergency Manager.
Blogging for Michigan has a chart showing what many cities would lose if this repeal is passed, anywhere from 17 percent to as high as 57 percent of all revenue.