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Personal Property Tax On Table?By JGillman, Section News
Excellent.
As many business owners understand, there is "property tax" and there is "property tax". And while the two seem to be quite similar, the difference is how one is handled over the other. Property tax as we all recognize is the repeated taxation on real property (acreage, land, buildings) which is used in a number of different formulas and provides a basis for government funding, millages for special purposes, and has for so many years until recently been a boon for local governments who would rather grow more services, than cut taxes on the increased value added properties. It is regressive, in that it discourages ownership, and puts at risk those on fixed incomes. Property tax on real property as it stands is already bad enough, yet has funded state and local government expansion to a point that any contraction in values puts at risk those things necessary and proper.
But "Property Tax", as in PERSONAL Property tax or INDUSTRIAL property tax, is something even more sinister. In 2007, I wrote: "For some of us, the process is mostly painless financially; A couple of desks, computers, a few inventory racks.. But for quite a few Job creators, it can make a profitable year much less so with equipment that costs hundreds of thousands for manufacturing processes etc.. All equipment bought for use in your business is taxable at the time of purchase. Then it is taxable when you use it, repeatedly, like real property tax. It is assessed a little differently, and relies for the most part on voluntary inventory declaration of business assets. (though larger businesses might have a personal visit from an assessor around Dec 31) It creates a level of work for the business owner that can be complicated depending on the quantity of business useable assets. It also creates a great deal of work for township assessors who must peruse the minutia (if they are doing the job properly) and properly report to the state the value of those assets and amounts collected. Often it becomes a whole lot of work for very little benefit, if anything at all. ~ More Below ~
In fact, the return in some instances is questionable. But questionable assessments are hardly rare in the world of government high finance and citizen's savings procurement. Even from just adding on to the plain ol property taxes it shows a desperation to reach into our pockets. I posited on the issue in 2008 that I had discovered locally when finally I got around to taking care of the business PPT:
"Oh wait.. it gets worse.. Yeah, I took issue that local government was being forced to remain inefficient. That was surely "bang for the buck" if I must opine. Not.
The good news however, is that Calley and Snyder are actually looking at the personal property tax issue with eyes open. I will applaud their decision to do so: "Proponents of eliminating the levy say it discourages business investment and growth and makes Michigan uncompetitive. Indeed. And even in the face of another hit to local governments (which Calley says will be handled) its the right thing to do. Some of those governments might find the returns in restoration of simplicities to be rewards in themselves. How many times must we pay for something? Ownership is one of the constitutional tenets that the country was founded upon. Without the ability to own free and clear, that which you have earned, why bother in the first place? Land and housing has a (albeit marginal) place in the scheme, with regard to fire and police and infrastructure taxing, but things? Job creating tools? Why would anyone want to locate them here? One wonders how we survived Granholm at all, frankly. It was bad enough that the MBT was a job killer. Add to it a liability for those who have the nerve to locate their pricey machinery in this state. A liability assessed yearly, and without regard to the financial shape or cash flow of the business which owns it. I applaud the legislative efforts made in throwing out this poorly considered part of our taxing mechanism. The brackish bathwater surrounding it demonstrates well that the drain could not be opened quickly enough or wide enough.
Personal Property Tax On Table? | 4 comments (4 topical, 0 hidden)
Personal Property Tax On Table? | 4 comments (4 topical, 0 hidden)
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Related Links+ In 2007, I wrote:+ I posited on the issue in 2008 + their decision to do so: + Also by JGillman |