Hmm, I have been back living in MI since 1992 and it was 6% then..
Here is a little bit of info on MI tax:
Michigan's key state taxes are:- Single Business Tax – the only general state tax for business
- Property Taxes
- Sales and Use Taxes
How Michigan Compares to the Nation- Michigan ranks below the national average in local business taxes as a percent of private sector Gross State Product according to the Council on State Taxation (Cost).
- Michigan businesses pay 39.4% of the state and local taxes compared to 43% nationally.
- Michigan business taxes have been growing substantially slower than the rest of the nation since 2000. Michigan's business taxes were up by 5.9% since 2000, compared to 13.7% nationally. Only three other states had slower business tax growth rates.
Single Business Tax
The Single Business Tax (SBT) is a modified value-added tax that has been in effect since 1976. The current SBT rate of 1.9% is scheduled to decline 0.1% per year until the tax is eliminated in 2010. The scheduled tax rate decline could be delayed if the state's budget stabilization fund drops below $250 million. The SBT:
- replaced seven different business taxes including business income taxes, franchise taxes and property tax on inventory.
- is based on value added during the production process, measured by total compensation with adjustments, business income, net interest paid and depreciation – all apportioned to Michigan.
- offers exemptions, deductions and credits, including an investment tax credit for capital purchases made in Michigan.
- provides eligible small businesses an alternative tax of 2% on adjusted business income.
Other important SBT notes: - Michigan businesses with less than $350,000 in sales are exempt from SBT.
- Treasury Department data show that 58% of Michigan businesses pay $1,000 or less in SBT; 45% of all businesses pay no SBT.
- The gross receipts reduction ensures that the tax liability cannot exceed 50% of adjusted gross receipts.
- Purchases of real and personal property in Michigan may be deducted as an investment tax credit and the value can be carried forward for 10 years.