Monday, January 03, 2005

Michigan Cities Consider Implementing Income Taxes

I'm unsure about other States across the US, but cities here in Michigan have the unfortunate ability to levy income taxes. Detroit and Lansing, as well as other cities levy these taxes in addition to property taxs.

A commuter working, but not living, in the city pays half of the income tax that a resident pays.

Now, according to the Detroit news, even more cities are contemplating inflicting this tax on their residents and workers. In Cities eye income tax to plug budget holes the Detroit News reports that Mount Clemens, Ypsilanti and Ann Arbor are considering levying these taxes, with 1% on residents and .5% on nonresidents.

The cities are also considering sweetening the pot by dropping property taxes somewhat and to make up for the lower property taxes in non-residents income.

Of course, these taxes certainly will not enhance these cites' images as desirable places to work. Raising the burden on workers already hit with federal and state income taxes and local property taxes is hardly going to increase prosperity in these cities and will likely make many potential employees condsider their location when choosing a place of employment.

After all if, The tax would cost a typical resident making $38,000 a year in taxable income an extra $370; or a commuter to the city $185. the employee willneed to take that into account.

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