High Gas Prices Don't Increase Michigan Sales Tax Revenues
LANSING – Despite the high cost of gasoline, Michigan is not seeing a boost in sales tax revenues from those prices. The response came from State Spokesman Terry Stanton, responding to arguments made last week by Mike Nystrom, vice president of the Michigan Infrastructure and Transportation Association, who said after Governor Jennifer Granholm said she did not support increasing the gas tax that perhaps the state should look at scaling back the sales tax on fuel sales. Most the sales tax goes to Michigan’s School Aid Fund instead of transportation projects, Nystrom said at that time, and charged that “taxpayers should recognize the state is reaping as much of a windfall on the price of gas as some of these oil companies,” saying that sales tax collection on fuel prices has risen from $330 million in 2002 to $664 million in 2007. But Stanton said in a letter that overall sales tax revenues show the state is not seeing any dramatic increase. Preliminary projections for the end of the 2006-07 fiscal year show the state will have netted $80 million less in sales tax revenues than the year before, Stanton said. On Friday, the County Road Association of Michigan joined MITA in criticizing the governor’s comments that she could not support a gas tax increase. read more
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