Detroit Chamber Doesn't Rule Out All Taxes
The Detroit Regional of Chamber today called on legislators to resolve the impasse over the Fiscal Year (FY) 2008 budget, but didn't rule out a temporary tax increase as a possible solution.
The Detroit Chamber stressed that "meaningful structural reforms and spending cuts" need to happen before talk of tax hikes. The Chamber would not support a sales tax on services or a general sales tax increase, but that's where the line ended.
"Time is running out to pass a budget that puts Michigan on a sound economic footing," said Richard BLOUSE, president and CEO of the Detroit Regional Chamber. "The lack of a solution that addresses meaningful structural reforms and spending cuts is creating uncertainty among business leaders about doing business in Michigan."
Legislative leaders and the Governor must address the state budget deficit and agree upon a solution before the beginning of the new fiscal year with a plan that only adds programs if ones of equal or greater cost are eliminated.
Chamber officials also stressed that "long-term meaningful structural reforms" need to be a component of any budget before lawmakers go down the revenue avenue. Possible ideas include bringing Michigan's prison population in line with other Great Lakes states. Restructuring school and local health care and retirement benefits should also be on the plate as should encouraging local and school consolidation.
Detroit Chamber officials say increasing the sales tax or expanding it to services would be a hassle for its members, not to mention a deterrent to their members' customers, which would explain their flat opposition to it.
Sen. Jud GILBERT (R-Algonac) told MIRS today he, too, would prefer that whatever tax increase is pushed through be temporary and not necessarily something put before voters, where the hike would have some permanency to it.
Reid, Coleman On Tax Hike
Two university presidents are pleading for more fiscal support from the state, but when given a chance to embrace an income tax hike, the University of Michigan president punted.
Mary Sue COLEMAN told WWJ NewsRadio 950 today that it's something lawmakers "have to do." She was asked specifically if she favored the tax hike and she did not answer.
Wayne State University President Irwin REID also checked-in on the need for more revenue and a tax hike. He told the radio station, "The state needs to add revenue…part of that is going to be a tax increase," he predicted.
Reid said this protracted budget debate is "not building confidence" as companies think about relocating here. He added that it's unfortunate that this has come "almost to the brink" to be resolved. He's assuming, of course, it will be resolved.
Adding another dimension to the talks among the Governor, the House Speaker and Majority Leader, Democrats are now complaining that Senate Leader Mike BISHOP (R-Rochester) refuses to debate the size of a possible tax hike. This leaves both the Governor and Speaker Andy DILLON frustrated.
Dillon, much like Reid, is concerned over the negative publicity surrounding this debate, especially if the state government goes through a partial shutdown. Dillon said sending the message that "Michigan is not open for business" is the wrong message.