The Detroit News explains proposal 1, which will appear on the August ballot.
Editorial: Vote yes on Prop 1
■Prop 1 would repeal Michigan’s Personal Property Tax, which is levied on business equipment.
■The Personal Property Tax, or PPT, is arcane and has been eliminated in all of our neighboring states. The fact that Michigan retains the tax makes it less competitive for jobs and investment.
■The PPT is a double tax that discourages businesses to add the equipment needed to create jobs. Employers must pay the sales tax on whatever they buy, and then pay the PPT every year the equipment is in use.
■Passing Prop 1 will not result in a tax increase for individuals.
■Tax revenue lost to local communities, which are the primary beneficiaries of the PPT, will be replaced by expiring business tax credits. There will also be a new special assessment on businesses to recoup some of the PPT dollars.