Over 60 business organizations have joined forces to repeal the newly enacted Use Tax on Services.  The "Ax the Tax" group hopes to persuade the legislature and the governor to kill the tax before it's start date of December 1, 2007. 

From the "Ax the Tax" November 1 press release:

"One month ago, the Legislature and governor created this mess of a tax, and they have one month from today to clean it up," said Brooks Patterson, Oakland County Executive.  "Let the message be clear, however; if they won't do it, taxpayers will."

If the legislature does not repeal the tax before December 1st, the group plans to gather more than 304,000 signatures needed to put a statutory initiative on the ballot in November 2008 repealing the 6% services tax.

There are two major obstacles to repeal:

1.deer hunting season, and

2.replacement of the lost revenue

The Senate last week addressed the first problem by passing (22-14) legislation that would delay the implementation date of the Use Tax on Services from December 1 to December 20.  That delay in implementation is contained in Senate Bill 845.  The Senate bill is tie-barred to to Senate Bill 838 which would repeal the new tax.  The package is considered to be a step toward possible legislative action to undo the much maligned services tax that was adopted in the wee morning hours of October 1st when state lawmakers were facing a state shutdown.  It also buys time.

It is not certain whether the House will go along.  Actually, that is doubtful.  The governor has stated that she is open to any adjustments as long as they are revenue neutral, permanent and bi-partisan; a high bar.

Replacement revenue options are: 

Increase the individual income tax rate

Increase the sales tax rate to 7%

Increase the Michigan Business Tax rates

Stay tuned for more action on this issue before November 15th, the start of the deer hunting (firearm) season.