Business owners push back on tax proposal

Published: Mar. 7, 2019 at 11:45 PM EST
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Gov. Gretchen Whitmer is defending her plan to repeal Michigan's pension tax.

Small businesses and several top Republican lawmakers say the governor's proposal to get rid of the pension tax and raise the corporate business tax would hurt businesses and the economy.

"I'm trying to give pension relief to people that are living on fixed incomes who had the law changed at the last minute on them and have no ability to pay for that new tax. And I want to eliminate the pension tax," Whitmer said.

If the plan is implemented next year, the business tax increase would raise $280 million in new revenue for the state.

Small-business owners were sounding off Thursday afternoon, expressing opposition to Gov. Gretchen Whitmer's plan to raise their taxes.

The governor's plan calls for all businesses to pay the 6 percent corporate income tax.

Right now, small businesses pay 4.25 percent.

News 10's Alani Letang talked with some owners on Thursday afternoon in Mason. They said that, hopefully, the state goes back to the drawing board and think of a different way, and listens to the business community.

"Personally as a business owner, I'm very concerned about any sort of tax increase that could impact our hiring plan. Increased taxes on small-business owners impacts jobs. I think, personally, that's a bad idea. The gas tax increase is interesting, taking job creators is a step in the wrong direction," said Ian Richardson, of Doberman Technologies.

The business community has an ally in the National Federation of Independent Business Owners.

The head of the group's Michigan chapter testified before the state Legislature Thursday morning.

He told us raising taxes on small businesses could ruin Michigan's economy.

"We want to continue our economic development; we want to continue that progress. We're very concerned about the proposals the governor's put forth to create a new small business tax. That will take us backwards. So we're not supportive of that at all," said Charlie Owens, of the NFIB.

News 10 talked with some small-business owners who said they aren't concerned about the possibility of a tax hike and that they felt confident they'd be able to make up for it.

Whitmer wants to use the money raised by expanding the corporate income tax to cover the cost of repealing the pension tax put in place under Gov. Rick Snyder.

Senate Majority Leader Mike Shirkey, of Jackson County, said that would be "doubling down on stupid."

We will, of course, keep you updated if anything moves forward.