Insurance premiums could increase $80 million annually under Governor Granholm's new business tax plan. That is according to Peter Kuhnmench, Executive Director of the Insurance Institute of Michigan. He calls the Governor's new proposal puzzling because the increase will ultimately be felt by the consumer, something he says she said she didn't want to do when restructuring the tax.
Kuhnmench says insurance premium taxes will rise from a little over one percent to 1.25 percent if the plan passes as currently proposed.
Others that stand to lose include banks, real estate firms and schools. Commercial and industrial businesses wouldn't have to pay specific mills in local school tax and state education tax on some of their equipment. But, the lost revenue could be made up taxing elsewhere, a shift of sorts.
The Michigan Health and Hospital Association is pleased with the proposal. Dave Finkbeiner, VP of advocacy for the organization, says it's positive that the Governor replaced what is being lost through the expiring Single Business Tax.