Citizens Research Council of Michigan President Eric Lupher was in Berrien County this week to highlight the “Ax MI Tax” proposal that backers are currently seeking to get on the ballot in the state next year.
Lupher was invited to speak at a forum where backers and opponents of Ax MI Tax discussed its merits. He tells us the proposal would eliminate all property taxes in the state, cutting off funding for all levels of government.
“The general property tax you have, but also at the state level,” Lupher said. “There’s the state education tax, utility property taxes. We think even your car registration. It’s based on the value of your car, so that sounds like a property tax to us. So it would get rid of all those property taxes.”
Lupher says the proposal seeks to backfill some of the funding local governments would lose by shifting state dollars from elsewhere, but it wouldn’t come close to replacing all the lost revenue. That would have some effects.
“Everything that we do with local government is funded with property taxes. Our local governments do get funding from the state, and this would increase funding from the state, but the net result is a huge decrease in the amount of revenue that the governments would have to operate from, and it would greatly shrink government. State government, local government, all government.”
The Michigan Municipal League says Ax MI Tax would cut about $17 billion in funding for services. It calls the proposal “an attack on our communities, and on schools, parks, libraries, community colleges, elections, trash collection, and public safety.”
Lupher says if passed, the proposal would be a fundamental and major shift in how all governments are run in the state, requiring a lot of time and thought to adjust to.
Supporters of the proposal say too much property tax is collected in the state only to be mismanaged by government. They say revenue from lost property taxes could be made up in other ways.