State sales tax could decrease, but services could be taxed
Businesses all over Michigan are gearing up for what could be a whole new tax. It's part of the governor's plan to balance the 2011 state budget.
Governor Jennifer Granholm is targeting Michigan's tax structure - saying that fixing the 80 year old system is one big piece of the puzzle to balancing the budget. The governor wants to drop the state sales tax from 6 % to 5.5%. Right now it covers sales on tangible goods, but the Governor is calling for the sales tax to cover services, as well. That could mean a new tax on everything from hair salons and spas to accounting services.
Until the specific details are released, it's not clear which service industries would be affected. But it's also possible ski resorts, golf courses, and other tourism-related businesses that don't sell "tangible goods" could also be taxed.
Even with a new tax structure, the Governor argues Michigan would still have one of the lowest sales tax rates in the country.
