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Report: Tax Incentives Can Be Taxing

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 By Tony BruscatoContact
May 15, 2009

Lansing, MI - Not all business tax incentives are created equal. Millions of dollars in tax breaks are having mixed results when it comes to helping Michigan businesses create jobs and spur economic growth.

A study commissioned by the Michigan Education Association and released Thursday by the Anderson Economic Group (AEG) gives high marks to tax incentives that encourage companies to renovate, expand or build plants in Michigan. However, AEG spokesman Patrick Anderson scores the state's film incentives program low, even though many believe it is effective in bringing business and tax dollars to Michigan.

"Just drive down any highway and you can easily see lots of manufacturing jobs, you can see high-tech jobs, you can see results coming from these incentives. But it's very, very difficult to find in Michigan a long-standing film industry."

Anderson says the state invests nearly $50,000 for each job created by the film incentive, money that could be used instead to lower taxes or invest in public schools that prepare students for the workforce.

Although he likes tax incentives if they give the state an advantage, Anderson wants the others eliminated.

"Keep those incentives that are most effective and get rid of the ones that are really not effective. Use the dollars that are freed up to either reduce taxes on employers or to fund additional government services, or both."

The Anderson Economic Group report is at www.mea.org/investing.

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