Why Michigan’s Proposal 1 isn’t as regressive as it sounds
In case y’all were not aware, there is an election May 5. I’ll be voting YES on proposal 1, which will raise the sales Tax from 6% to 7% to fund road repairs, schools, and cities.
Now, I know it’s May day, and you good progressives might be saying “but Gillian, Sales Tax is regressive! Why would you vote for a regressive tax?” I just wrote up a lengthy response to that question, if you care to read it.
I think we all agree that this bill is far from perfect, and I certainly understand that a sales tax is regressive and has the potential to harm the poorest people in the state. It’s not what I would have chosen, but I think *not* passing this would be even worse for low-income folks in particular. Here’s my thinking:
(1) The Earned Income Tax Credit fund would be restored. This is huge for working families, and would in most cases more than replace the extra cost of the sales tax.
(2) Transportation funding doesn’t just support roads, it also supports public transit. Funding transit is absolutely essential to promoting equity and making sure people can get to work go regardless of income or ability.
(3) We are all already paying the “pothole tax.” I just spent $250 getting my shocks replaced *again.* Thankfully, I am in a financial situation where that is not a huge burden to bear. For a lot of people, though, the additional burden of fixing the car and getting to work without one (see also: public transit) can make life very difficult.
(4) The cost of roads would be paid for by people who drive cars, and the gas tax would no longer entirely follow a cents-per-gallon model–this is important because rich people are able to drive newer, more efficient cars and pay less in gas tax, even though those cars degrade the roads equally. Commercial vehicles would also pay more since they have a bigger impact on roads.
(5) This bill constitutionally protects the School Aid Fund so state lawmakers can no longer rob schools when they run out of money.
(6) This restores essential funding streams to cities, which in many cases (like Ypsilanti) could be what is needed to keep cities from going bankrupt. If you haven’t noticed, the state seems very happy to take over poor, usually mostly black, cities and sell off all their assets to solve a problem that the state created in the first place.
(7) If this does not pass, Republicans will have the perfect excuse “see? people don’t want to pay taxes for schools and roads!” to continue moving the state toward tea party heaven.