(LANSING) - A sweeping tax overhaul proposal in Michigan would cut property taxes and require major utility rate rollbacks while expanding the state's sales tax to certain luxury services.
House Speaker Matt Hall, R-Richland Township, is proposing a 6% sales tax on services such as limousine rentals, country club memberships, golf, skiing, private jet travel, performing arts, artificial intelligence services and political advertising. The plan is projected to generate about $4.73 billion annually.
Hall says the revenue would offset a broader $5 billion tax package that would eliminate the State Education Tax, the real estate transfer tax and remaining personal property taxes. He argues the proposal would still amount to a net tax cut of roughly $270 million and could be the largest tax reform in state history.
Many everyday services would remain exempt, including health care, child care, legal services, landscaping, auto repair, veterinary care and personal grooming.
The plan also calls for $1 billion in mandated utility rate rollbacks. Hall says eliminating personal property taxes on utilities should translate into guaranteed savings on energy bills for residents.
Supporters say tourism-related taxes would largely fall on out-of-state visitors, while critics are expected to scrutinize the economic impact and feasibility of the proposal.
Lawmakers are expected to debate the measure in the coming weeks.