Tim Skubick

Raise your hand if you remember the 1994 statewide vote on Proposal A which produced property tax relief with a corresponding hike in the state sales tax?

For those of you who were politically asleep or young chickens at the time, it was an historic moment in state history. With the state granting property tax relief to put more money in the pockets of weary taxpayers, leaders had to find some way to replace those dollars which went to schools and local governments that relied heavily on the property levy.

In a bit of political wizardry and brilliance, Gov. John Engler and friends devised a plan, some might have called it a scheme, to avoid forcing lawmakers to vote for an increased tax to get that job done.

The plan was, let’s allow the voters to do the dirty work and our collective political hands will be clean as the new fallen snow.

Hence Proposal A was drafted that granted the taxpayer relief but that was linked to raising the state sales tax.

The governor et.al. explained to the voters that if they rejected the sales tax, the state income tax would automatically kick in thus producing what affectionately became known as the “tax shift.” Some critics added another phrase… the ole tax shift/tax shaft!

Well the voters supported proposal A and for the moment the property tax revolt in the state lead by the likes of a county drain commissioner Bob Tisch vanished.

Fast forward to now with the House GOP Speaker Matt Hall lamenting that home owners once again are burned that the tax on their homes and land is again burning a hole in their pocketbooks. In fact it’s so bad there is an actual petition drive to eliminate the property tax in total with no replacement tax.

Hence the speaker reports, and brace yourself for this, “we are working on developing a next Proposal A, a modern Proposal A and I want to put that up for a vote.”

Two things to keep in mind. 2026 is an election year for everybody in this town except the capitol grounds keepers and wouldn’t it be nifty if lawmakers offered up some tax relief. Not just because they agree that the taxes are too high, but just because it might cement their re-election efforts at the same time. And in keeping with the wizardry behind the original Prop A, this son of Prop A takes legislators off the tax increase replacement hook and again shifts it to you.

Happy holidays.

“What I’m looking at are two potentially competing proposals working thru the legislature to put that on the ballot and giving the people of Michigan two choices,” as house leader echoes the same statements of Mr. Engler back in they day.

And to his credit, he is up front about the fact that, “it will be a tax shift on how the revenue is raised. We want to reduce people’s property taxes. We want to eliminate the personal property taxes that is a lot of what small businesses pay. While not embracing the sales tax just yet he does reflect that one of the substitute taxes, ” may deal with the sales tax. You’re going to have to. This is one of the ways you could deal with it.”

As for the second tax hike, he’s not there yet but the betting money is on it will not be the income tax which voters would be loathed to support…in an election year or any other year for that matter.

He has not approached Gov. Whitmer on all this yet as his staff has reportedly prepared a list of “20 or so options” that he is reviewing. He’s also thinking, in the spirit of bipartisanship, he might let the Democrats pick option two.

Either way, he also knows that whatever is crafted with require a super majority of votes in both houses because it is a constitutional change. That means, the package has to be written to produce true bi-partisan language otherwise the whole shebang heads to the legislative elephant burial ground.

While no final sign-off has been made on the sales tax option, that has lots of curb-side appeal that the politicians can use to sell the proposal. Unlike the income tax which most everybody has to pay, the sales tax, depending on what items are hit with the tax, gives the consumer a choice. He or she is not obligated to pay it and for them, it could be a total savings.

So pull up a chair and look for this puppy to reach critical mass in the new year.

Is it a repeat of history in the making or do they eventually file it under, “close but no cigar?”