Summary of School Finance Proposal Ballot Plan Taxes Income Tax .1 4, 11 /0- PP ggi g. o- A*. 'reggili.V fl Statutory Plan. 6 Mills on Homesteads 24 Mills on Non-homesteads 1ZMills on Homesteads 24 Mills on Non-homesteads Decreases rate from 4.6% to 4.4%. Increases rate from 4.6% to 6.0% 'reieWit Increases the sales/use tax rate from 4% to 6%. Single Business Tax No Increase; SBT rate will remain at 2.35% Increases from 2.35% to 2.75% Tobacco Products Tax Cigarette tax increases by 50 cents/pack. Levies a new tax on non-cigarette tobacco products at 16% of price. Cigarette tax increases to 40 cents/pack and the other tobacco tax will be 16% of the wholesale wholesale price. Interstate Telephone Tax Subjects interstate and international telephone calls to the increased use tax rate of 6%. 1-800-#$ and WATS are exempt. Subjects interstate and international telephone calls to the present use tax rate of 4%. Personal Exemption on Income Tax Return No change. The personal exemption will remain at $2,100 per person. Increases the personal exemption from $2,100 to $3,000 per person. Seniors increase to $3,900. ,-,-,—vFsvfastoovovtia w!ar . : Real Estate Transfer Tax A new state revenue stamp will be required for all property transfers ($20 for every $1,000 in value or 2%). A new state revenue stamp will be required for all property transfers ($10 for every $1,000 in value or 1%). 0ftwigNittre; pity :1;.gE8 .:Z1 Prepared by Protec, Inc. across the country, Michigan has one of the lowest sales tax- es around," said Mr. Epstein. "In most states, the sales tax is 6 or 8 cents. In a place like New York City (which has a 8-cent sales tax), you feel like you're buying the product twice." If Michigan voters elect a 6 percent sales tax, which would take effect in July, retail experts say consumers will boost their purchase of high-priced items like cars, televisions and stereo systems before the levy becomes law. For businesses, especially such industries as real estate, lending and home supplies, a new 2 percent property transfer tax would likely slow the pur- chase of new and used homes, said Robert Mattler, president of Protec, Inc. in Southfield, which specializes in analyzing the equitable assessment of property taxes. "A transfer tax of 2 percent is quite a sizeable bill," said Mr. Mattler, a property tax attorney. "If you're already paying a real estate agent 6 percent commis- sion for a home sale, and another 2 percent is tacked on to that, it can be awfully expen- sive. That's definitely going to slow down the real estate in- dustry. "And if you slow down the real estate industry, that puts construction jobs in jeopardy, and it means people won't be buying homes supplies like smoke alarms, door bells and alarm systems. The 1 percent transfer tax isn't as onerous, but it still hurts." Mr. Mattler added that while both plans allow for property tax reductions, whether it be a home or business, the plans translate into smaller deduc- tions on income tax statements. Because of this, and other fac- tors, Mr. Mattler labels the state tax plan "a tax hike, instead of a tax shift." Meanwhile, at the federal lev- el, Pat Gregory, director of tax- ation for Follmer, Rudzewitz & Co., a Jewish-owned, mid- sized accounting firm with offices in Southfield and Mt. Clemens, said the tax plan offers a new 36 percent bracket which includes married couples with taxable in- comes after all deductions ex- ceeding $140,000, heads of households over $127,500 and singles over $115,000. "People will have to sit down early and study the tax forms and work out a strategy," said Mr. Gregory. "But of the 116 million taxpayers out there, roughly 1.2 percent will be moved into higher brackets. And as for new taxes on retirees, they touch only the top 13 per- cent." Mr. Gregory added that busi- nesses which plan to make fu- ture tax deductions on such items as travel expenses will have to keep more careful records when the new levies take effect. "Some travel ex- penses are now 100 percent de- ductible, others are not," said Mr. Gregory. "I would break down meals, airline tickets, en- tertainment, etc. in separate cat- egories. It will be a lot easier to figure out come tax time next year." As if new federal and state taxes aren't enough, Detroit Mayor Dennis Archer has pro- posed an increase in entertain- ment taxes in metro Detroit to help fund cultural institutions like the Detroit Institute of Arts. The new tax, if enacted by vot- ers, would not take effect until later this year. ❑ ome and water Oifi ties in Mkt ria. The profect is worth $120 million and is expected to take two years to,complete. Balton has appointed Solel Boneh In- ternational as the main sub- contractor for the project.