Michigan’s Jobs…

What does the future hold?

With Michigan’s unemployment rate the highest in the nation, it’s time for the legislature to take action to keep and create jobs in Michigan.  Governor Granholm has recently introduced the Michigan Jobs and Investment Act that will revise the Single Business Tax and help stop the bleeding of good paying jobs.

Act Now to Protect Your Job!

Congress is about to consider the Central American Free Trade Agreement (CAFTA), which will expand NAFTA to five Central American countries and the Dominican Republic.  NAFTA has cost Michigan over 76,000 good paying jobs.  CAFTA is just like NAFTA – it’s a bad trade deal that doesn’t protect workers’ rights.

CAFTA will ship more U.S. jobs overseas and will do nothing to lift people out of poverty in Central America and the Dominican Republic, it contains very little protections for workers, both north and south.  CAFTA will devastate our communities, shut down workplaces and leave skilled workers without jobs, while workers in poorer countries continue to struggle for basic human rights and are paid poverty wages.  We must act now to protect our jobs and say “NO” to more bad trade deals.  Call your member of Congress today at (202) 224-3121 and tell them to vote “NO” on CAFTA.

Michigan Jobs and Investment Act

Revitalizing Michigan Through Tax Fairness

Top 4 Distortions of Governor Granholm’s Proposal

Distortion #1  “The Governor’s proposal is an $800 million tax increase on 22,000 businesses.”

Every business in Michigan that pays the SBT will get a cut in their rate.  But by closing some loopholes and moving the tax to focus more on profits, as most businesses have suggested, some will see that rate cut offset somewhat.  For instance, a company could see its taxes dramatically reduced by the 37% reduction in the SBT rate, but then lose some of that benefit due to a loophole closing – and still have an overall net reduction.  Similarly, some of the companies that end up paying

more under this proposal – those companies for instance, have created shell companies under professional employee organizations primarily to escape paying their fair share of taxes – will see those losses offset by the rate reductions.

Distortion #2 “This plan increases taxes on small businesses.”

Most small businesses in Michigan pay the alternative tax rather than the SBT.  The Governor’s plan cuts the alternative tax rate by 40%.  66,000 small businesses – that’s businesses with gross receipts under $10 million – will get a tax cut.

Distortion #3  “Insurance companies will have to pay more than $400 million in new taxes.”

Insurance companies have enjoyed preferential treatment in Michigan for a long time.  All this proposal asks is that they pay their fair share.  And that fair share is not $400 million.  The Michigan Department of Treasury estimates that increasing the premium tax to 2% - a rate equal to or below the rate in 35 other states – will increase insurers Michigan taxes by around $250 million.  And, don’t be fooled by the scare tactic about rates going up.  If insurance rates were driven by taxes, Michigan would have the fourth lowest insurance rates in the nation…which we don’t.

Distortion #4  “This plan helps industries that are losing jobs while hurting those that are creating jobs.”

Nearly one in every five people in Michigan is employed in manufacturing.  Manufacturers represent more than 20% of our state’s economic activity. 

Every manufacturing job we create adds four to nine additional jobs to our economy.  Every manufacturing job we lose takes four to nine additional jobs out of our economy.  We must make sure every business is paying its fair share.  But we should build on our state’s strengths – the manufacturing segment – rather than give up on that segment for the hope that something else may come along.  We’ve had the fourth lowest insurance taxes in the nation for more than 20 years….yet we have only 37,000 insurance company jobs in the state.