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Granholm proposes more tax increases
Gov. Jennifer Granholm has released a plan to cut spending by more than $550 million while raising a similar amount in additional revenue through a combination of tax increases and reduction of business tax breaks.The governor put out written details Tuesday on how she would close a $1.8 billion gap in the general fund in the budget year that starts Oct. 1. Michigan faces a budget shortfall of at least $2.7 billion, but Michigan will be able to fill some of its budget shortfall with federal recovery money. Granholm's plan includes reducing some business tax breaks, including the film credits. It also would reduce an increase in a tax credit for the working poor, increase liquor license fees, expand the 6 percent sales tax to live entertainment, service contracts and vending machine sales, raise the cigarette tax rate to $2.25 a pack, among other changes. Her comments came after several Michigan business organizations said Tuesday they want lawmakers to cut spending and improve government efficiency rather than raise taxes. The pro-cuts coalition called for pooling health care plans and raising the share of costs for public employees, cracking down on Medicaid fraud, consolidating school administration and several other changes. The pro-cuts coalition includes the Michigan Chamber of Commerce, the Small Business Association of Michigan and other groups. Just last week during a stop in Troy, Granholm said that Michigan doesn't need a tax increase now. "I'm not in favor of new taxes. We don't need a tax increase. People in the state are having trouble paying their bills," Granholm said to reporters during a visit to Compact Power. Posted by: Fred 2009-09-10 |
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