(Act No. 80, Public Acts of 2014)
In yet another round of shell game playing, our esteemed leadership in Lansing has just about outdone themselves with the transparent sophistry on display with this new tax hike scheme called Proposal 1 that is being portrayed as the sheep’s skin, when in fact it is the proverbial wolf acting as a fox in the hen house (see, we liberty lovers can play word games too).
Of course, as is typical, this Senate Bill (No. 822) is not a standalone bill that might make it easier to follow, interpret, understand and agree to, if one were so inclined to do so. It is part of a package made up of ten bills: Senate Bills 821, 822, 823, 824, 826, 827, 828, 829 and 830. And it is an amendment to 1937 PA 94 Sections 3, 19 and 21 as amended by 2007 PA 103, section 19 as added by 2004 PA 172, and Section 21 as amended by 2010 PA 37, and by adding Sections 2c and 10a.
Are you sufficiently confused yet or are you ready to raise your right hand, place your left hand on the Holy Bible and swear that you have read, tracked, collated, connected and otherwise comprehended all of the amendments and the original legislation regarding the issue of levying, assessing and collection of specific excise taxes on the storage, use or consumption in this state of tangible personal property and certain services? Neither have I, nor do I suspect that our elected officials can or will swear to an understanding of all of this either. That’s just not the way big government works.
Instead they insert well thought out sentences into excessively wordy legislation that they can then cherry pick and insert in a general summary that is then presented to the public for review, reaction and acceptance, such as: Section 3 (7) final sentence reads “The authority shall not increase any tax or tax rate, but is authorized to and shall levy the local community stabilization share at the rate provided in subsection (5).”
I would believe that this particular sentence was used to create the bullet point 4 that is shown on the ballot language which reads: (4) Prohibit Authority from increasing taxes. This (4) bullet point conveniently leaves the clause “but is authorized to and shall levy the local community stabilization share at the rate provided in subsection (5)” completely out of the general summary.
A thorough reading of subsection (5) informs the reader that the specific tax levied at the carefully delineated rates in each of the following fiscal years increases this new revenue source from $96,100,000.00 in the fiscal year 2015-2016 to an astonishing $572,600,000.00 in revenue for the fiscal year 2028-2029. Will our children and grandchildren ever forgive us?
But then in the next breath or rather in the next subsection (6) the act continues by stating that, “The state share includes the portion of the use tax imposed at the additional rate of 2% approved by the electors of this state on March 15, 1994” … but continues by stating that “The local community stabilization share does not include the portion of the use tax imposed at the additional rate of 2% approved by the electors of this state on March 15, 1994”. So does it or doesn’t it, and what exactly does this mean? Is the newly requested 6% in addition to the 2% that was added to the 4% in 1994? Who really knows?
There’s more. This Section (3) of PA 80 called Proposal 1 is revealing, albeit confusing. Subsection (1) can be explained with excerpts as follows: “There is levied upon and there shall be collected from every person in this state a specific tax” … “for the privilege of using, storing, or consuming tangible personal property in this state at a total combined rate equal to 6% of the price of the property or services specific in Section 3a or 3b.”
Okay, before we get to an analysis of Section 3a or 3b, we discover that our elected officials believe that it is a “privilege,” beholden to the state to own personal property. I actually thought it was something of an honor to work hard, earn a paycheck and choose to purchase personal property to add to the pursuit of happiness protected in our constitution. Oh, I forgot, big government lovers don’t feel compelled to follow the constitution; but that is a subject for another day.
Back to Section 3, subsection (1) section 3a and 3b, for which it is claimed that they have been written “For the purpose of the proper administration of this act and to prevent the evasion of the tax.”
Section 3a indicates that this new tax levy applies to tangible personal property that is purchased “if brought into this state within 90 days of the purchase date and is considered as acquired for storage, use, or other consumption in this state”. Okay, that seems to cover just about everything purchased by everyone for every reason.
But Section 3b gives us some exemptions by stating that property used “solely for personal, non business purposes that is purchased outside of this state and is not an aircraft is exempt” but only if a couple of conditions are satisfied. What are the conditions, you ask? They are if “The property is purchased by a person who is not a resident of this state at the time of purchase and is brought into this state more than 90 days after the date of the purchase” or if “The property is purchased by a person who is a resident of this state at the time of purchase and is brought into this state more than 360 days after the date of purchase.”
Who in the world dreams up these types of word trick pieces of legislation? Who in the world is benefitting from these types of unenforceable exemptions? And how many new bureaucrats are going to get paid excessive compensation packages in an effort to try to enforce these unenforceable exemptions; let alone the number of new bureaucrats with excessive compensation packages who would have to be hired to set up and manage the intrusive regulatory spider web that will be required if this act passes?
Oh, but just think, all of these new regulators will increase the employment numbers, so the big government lovers will be happy and their lap-dog media will have something to wag their tails about. See how it all works at our expense?
Even though I do not like the current confiscatory tax scheme on business’ personal property (which is double and triple taxing the most productive members of society), I urge you to VOTE NO on Proposal 1 on August 5, 2014 and force our elected officials to do better than this piece of political sophistry.