Report suggests Michigan tax cuts have hampered prosperity

May 14, 2014

Michigan ranks 49th in the country in terms of the percentage of state and local taxes paid by business.
Credit Wikimedia Commons

A recent report casts doubt on the impact of two decades of tax-cutting in Michigan. It suggests that the resulting cuts in public revenue have seriously prevented greater prosperity.

“Michigan’s Tax Policies: Wrong Turns on the Path to Prosperity” is a data-driven analysis that finds $51-billion in public revenue have been eliminated due to tax cuts.

Among the conclusions: most of the $51-billion reduction would have gone to K‐12 education.

The report, overseen by former state Treasury official Douglas Drake, was underwritten by a consortium of teacher and education groups including the Michigan Education Association, the Michigan Association of School Boards and others.

Mr. Drake is recovering from an illness, so to explore the study and its findings a bit more, Current State spoke with colleague Mitch Bean. He's founder and partner of Great Lakes Economic Partners in Eaton Rapids and is the former Director of the House Fiscal Agency.

Bean says he wasn't surprised by the report, and neither did the magnitude of the tax cuts.