Detroit:
There’s More than One Way to Raise a Tax

Mar 15, 2004

Homeowners in the Detroit area have noticed that local tax assessors have been raising their property assessments, which means they will pay higher taxes. This is only the latest chapter in a 1994 "tax cut" which turned out to be a tax increase for working people.

Property taxes in Michigan were cut in 1994 by 30% as a result of a ballot proposal pushed by the corporations. That proposal was mainly aimed at lowering the taxes paid by the corporations, but it did so under cover of lowering property taxes for ordinary homeowners.

Local governments have been trying ever since to cover for the tax money they lost.

In the adopted proposal, the state sales tax was raised and money from the increase was shared with local governments–and corporations don’t pay the sales tax, but working people do.

Ever since, fees for things like drivers’ licenses, and user taxes like gasoline and cigarette taxes have been going up. In other words, more and more taxes were shifted onto ordinary working people.

On balance, we ended up paying out more in taxes than before the tax cut.

And now comes the latest insult. More than 52 cities and townships have raised valuations on homes at over twice the rate of inflation.

In fact, this is only a way to raise property taxes, without appearing to do it. When they raise the valuation of a home, the tax on it goes up. We don’t hear corporations crying out about increases in their property tax rates, because their valuations have not gone up. On the contrary, in Plymouth Township, for example, Johnson Controls just received a designation from the township that will allow it to upgrade its headquarters without increasing its property taxes.

The bosses’ politicians raise our taxes and cut those to the corporations. Then they have the gall to tell us we should be happy because our increased property assessments mean that our homes are worth more!

Their smooth talk just doesn’t cut it.