Repel of SBT has immediate negative effect

BRIGHTON – The announcement Wednesday by Standard & Poor's that it is giving Michigan a negative outlook on its credit rating just hours after the State House and Senate voted to repel, the Single Business Tax two years ahead of schedule is just one more reason not to retain the House leadership in November.

Mike McGonegal, candidate for the Michigan House from the 66th District, said his opponent in the election helped lead the charge in its irresponsible early repel of the SBT that led Standard & Poor's to lower the state's rating on general obligation bonds to "AA. He said Wall Street is officially reaffirming the Legislature’s rash action Wednesday as a bad business decision for Michigan.

“This outlook is used by investors to make decisions,” McGonegal said. “The simple truth is the uncertainty of how the tax structure will be rewritten is deterring any business investment and relocation to Michigan.”

McGonegal also challenged Chris Ward and the House leadership to spell out exactly what it intends to cut to balance the state budget after a $2 billon cut in revenue that accounts for 25 percent of the budget. Those cuts will effect everyone in the state in the form of higher tuition costs at Michigan's college and universities, parks closing, prisons releasing criminals early, less money to public schools, less money for road maintenance, mores cuts in local revenue sharing that goes for police and fire protection and more of a tax burden to individual to make up for just a fraction of the lost revenue.

“It’s so convenient that these painful cuts will not even be talked about until after the election, protecting the Legislators from any accountability,” McGonegal said. “In the meantime, they can campaign using the myth that they actually cut taxes.”

McGonegal said he agreed that the SBT needs to be repealed and a better business tax found, but he said it’s irresponsible to repeal it without a solution even on the horizon.