Comments on: Michigan Tax Revenue Continues to Deteriorate http://www.grpundit.com/2009/06/22/michigan-tax-revenue-continues-to-deteriorate/ Politics | Economics | Society | Grand Rapids, Michigan Tue, 13 Sep 2011 15:32:09 +0000 hourly 1 By: MarkJ http://www.grpundit.com/2009/06/22/michigan-tax-revenue-continues-to-deteriorate/#comment-543 MarkJ Tue, 04 Aug 2009 19:18:31 +0000 http://www.grpundit.com/?p=381#comment-543 Actually, if you look at taxes collected as a percentage of total personal income in the various States, there doesn't appear to be any correlation between tax levels and unemployment rate. Florida has one of the lowest tax incidences in the nation but their unemployment rate is nearly as bad as Michigan's. In fact if you average the 11 states with the lowest tax rates and the 11 with the highest tax rates, the 11 with the highest tax rate average unemployment rate is lower than the average unemployment rate for the 11 states with the lowest tax rates. Oregon, Georgia, Tennessee, Alabama and South Carolina all have low tax rates and unemployment over 10 percent. Meanwhile Vermont, Hawaii, and North Dakota are the three states with the highest tax incidences, and Vermont and Hawaii's unemployment rates are well under 8 percent, and ND unemployment rate is less than 5 percent. I'm not saying that raising taxes is the best thing to do in a recession, but there's more to Michigan's economic woes than taxes, and the State is required to balance the budget. Actually, if you look at taxes collected as a percentage of total personal income in the various States, there doesn’t appear to be any correlation between tax levels and unemployment rate. Florida has one of the lowest tax incidences in the nation but their unemployment rate is nearly as bad as Michigan’s. In fact if you average the 11 states with the lowest tax rates and the 11 with the highest tax rates, the 11 with the highest tax rate average unemployment rate is lower than the average unemployment rate for the 11 states with the lowest tax rates.

Oregon, Georgia, Tennessee, Alabama and South Carolina all have low tax rates and unemployment over 10 percent. Meanwhile Vermont, Hawaii, and North Dakota are the three states with the highest tax incidences, and Vermont and Hawaii’s unemployment rates are well under 8 percent, and ND unemployment rate is less than 5 percent. I’m not saying that raising taxes is the best thing to do in a recession, but there’s more to Michigan’s economic woes than taxes, and the State is required to balance the budget.

]]> By: rollnggrnade http://www.grpundit.com/2009/06/22/michigan-tax-revenue-continues-to-deteriorate/#comment-516 rollnggrnade Tue, 30 Jun 2009 15:27:33 +0000 http://www.grpundit.com/?p=381#comment-516 Correlation does not equal causation. If it did, one could draw the conclusions that the Bush Administration's massive tax cuts were responsible for the current recession. Correlation does not equal causation. If it did, one could draw the conclusions that the Bush Administration’s massive tax cuts were responsible for the current recession.

]]> By: Southwest Washtenaw http://www.grpundit.com/2009/06/22/michigan-tax-revenue-continues-to-deteriorate/#comment-510 Southwest Washtenaw Tue, 23 Jun 2009 15:16:11 +0000 http://www.grpundit.com/?p=381#comment-510 Nick - collection levels did not "drop so precipitously after taxes were RAISED by $1.5 BILLION in 2007" The House Fiscal Agency Quarterly Revenue Report in October 2008 indicated that total revenue (4th quarter 07-08) had increased from 06-07 (4th quarter) by 8.4%. YTD revenue had increased by 8.2 %. 4th Quarter (06-07 to 07-08) Income tax revenue was up by 10.1%, Sales and Use taxes were up by 1.7%, MBT/SBT and Insurance taxes were up by 76.2%. Only "Other Revenue" (SET, RET, tobacco tax, and lottery revenue) had declined by 0.6%. Nick – collection levels did not “drop so precipitously after taxes were RAISED by $1.5 BILLION in 2007″

The House Fiscal Agency Quarterly Revenue Report in October 2008 indicated that total revenue (4th quarter 07-08) had increased from 06-07 (4th quarter) by 8.4%. YTD revenue had increased by 8.2 %.

4th Quarter (06-07 to 07-08) Income tax revenue was up by 10.1%, Sales and Use taxes were up by 1.7%, MBT/SBT and Insurance taxes were up by 76.2%. Only “Other Revenue” (SET, RET, tobacco tax, and lottery revenue) had declined by 0.6%.

]]> By: Nick http://www.grpundit.com/2009/06/22/michigan-tax-revenue-continues-to-deteriorate/#comment-509 Nick Tue, 23 Jun 2009 12:45:05 +0000 http://www.grpundit.com/?p=381#comment-509 Funny that collection levels would drop so precipitously after taxes were RAISED by $1.5+ BILLION in 2007. A guy might get the idea the two were connected... --Nick www.RightMichigan.com Funny that collection levels would drop so precipitously after taxes were RAISED by $1.5+ BILLION in 2007.

A guy might get the idea the two were connected…

–Nick
http://www.RightMichigan.com

]]> By: rollnggrnade http://www.grpundit.com/2009/06/22/michigan-tax-revenue-continues-to-deteriorate/#comment-508 rollnggrnade Mon, 22 Jun 2009 19:48:37 +0000 http://www.grpundit.com/?p=381#comment-508 We're in the middle of a worldwide economic downturn, a national recession, and an ongoing and comprehensive restructuring of the state's economy (after decades of neglect). As such, I don't think it's fair to analyze the state's economic performance solely through the lens of tax policy. Declining cigarette sales (and tax revenues) are a good thing because it means that the state will be paying less for tobacco-related illnesses. Unfortunately that's a long-term cost savings so the results aren't immediate. Tax cuts are not a panacea, and slashing the tax rate isn't going to magically turn everything around for the state. If that were the case, the states with the highest tax rates should be doing worse than we are, and yet they're not. According to the Tax Foundation, Louisiana has the lowest tax burden in the US and yet their government is still struggling for revenue: http://www.dailyworld.com/article/20090618/NEWS01/906180301/1002 We’re in the middle of a worldwide economic downturn, a national recession, and an ongoing and comprehensive restructuring of the state’s economy (after decades of neglect). As such, I don’t think it’s fair to analyze the state’s economic performance solely through the lens of tax policy.

Declining cigarette sales (and tax revenues) are a good thing because it means that the state will be paying less for tobacco-related illnesses. Unfortunately that’s a long-term cost savings so the results aren’t immediate.

Tax cuts are not a panacea, and slashing the tax rate isn’t going to magically turn everything around for the state. If that were the case, the states with the highest tax rates should be doing worse than we are, and yet they’re not.

According to the Tax Foundation, Louisiana has the lowest tax burden in the US and yet their government is still struggling for revenue:

http://www.dailyworld.com/article/20090618/NEWS01/906180301/1002

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