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2 The Michigan FairTax Replaces Current 6% sales tax on goods. Michigan 4.35% Personal Income Tax (PIT) Michigan 6% Corporate Income Tax (CIT) Business.

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Presentation on theme: "2 The Michigan FairTax Replaces Current 6% sales tax on goods. Michigan 4.35% Personal Income Tax (PIT) Michigan 6% Corporate Income Tax (CIT) Business."— Presentation transcript:

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2 2 The Michigan FairTax Replaces Current 6% sales tax on goods. Michigan 4.35% Personal Income Tax (PIT) Michigan 6% Corporate Income Tax (CIT) Business Personal Property Tax (PPT) 6 mill State Education Tax on business (SET) Sales tax on business purchases

3 3 The Michigan FairTax Replaces Michigan Personal Income and Business Taxes with a 9% sales tax on new goods and services. Lowers the cost of goods and services produced in Michigan by removing the cost of business taxes that are hidden in today's prices. This improves competitiveness creating Michigan jobs.

4 4 The MI FairTax Accomplishes

5 5 The Michigan FairTax Base MI FairTax taxes citizens directly and honestly with a visible retail sales tax MI FairTax is NOT imposed on: –Business to Business sales –Non-profit organizations

6 6 The MI FairTax Accomplishes

7 7 Special Provisions Prebate to all legal Michigan residents to pay tax on the necessities of life –MI FairTax is Progressive --- Households at the poverty level have a zero tax rate – As spending increases the effective tax rate increases –Effective Tax Rate for the typical MI family of four is 2.5% after prebate and untaxed items

8 8 Special Provisions – Prebate Michigan FairTax Prebate: 9% Tax Rate Family Annual Monthly Household Size ConsumptionPrebate Allowance * 1 Adult $11,170 $922$ other person $15,130$1,249$ other persons $19,090$1,576$ other persons $23,050$1,903$ other persons $27,010$2,230$ other persons $30,970$2,557$213 * The annual consumption allowance is the amount of spending that is "untaxed" under the Michigan FairTax. Prebate equals the Michigan FairTax included in the federal poverty level guidelines by family size. Poverty level guidelines as provided by the U.S. Dept. of Health and Human Services, January 26, 2012.

9 9 Effective Tax rates

10 10 Compliance/Tax Evasion Easier tax enforcement –90% fewer tax filers. Only retail businesses file a sales tax return. –Taxes the underground economy (illegal drugs, illegal labor, prostitution, etc.) –Over 4.4 million personal returns filed in 2009 The simpler MI FairTax encourages compliance and is difficult to avoid

11 11 The MI FairTax Accomplishes: Eliminates all tax loopholes Eliminates the buying and selling of tax favors for special interests that today corrupts our political system It makes our true tax burden visible on every sales receipt -- not hidden in the prices of the things we buy

12 12 The MI FairTax Simple Efficient Fair Promotes Business Simulates Michigan’s Economy Creates Jobs!

13 Fuel the message!

14 14 What do we want from you? Go to our Web Site and download our MI FairTax flyer & other infowww.mifairtax.org Get involved. Contact your local MI FairTax Representative via the web site, and volunteer Invite a MI FairTax Spokesperson to speak to a group or the media in your community Ask community leaders and friends to advocate for the MI FairTax Make a Financial Contribution to the MI FairTax


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