Michigan Services Tax Repealed And Replaced
Great news for Michigan warehouse operators! For those of you who have not heard, Governor Jennifer Granholm signed repeal and replacement legislation on Saturday as the Michigan Services Tax was scheduled to take effect. An agreement to repeal the 6% tax came just two months after it was enacted as part of the Oct. 1 deal to address the state budget crisis. Details regarding the repeal and replacement of the tax can be found by clicking here.
IWLA would like to recognize the highly coordinated and efficient response which occurred throughout the past several weeks regarding the Michigan Services Tax. Several key industry elements needed to be emphasized in Lansing throughout that time. Industry administrative costs, the possible effect of operations moving out-of-state and the large margin in our industry were all key points of conversation. We reacted quickly and effectively educated legislators about the warehouse logistics industry. Following are some of the larger achievements over the course of the past few weeks:
- Upon learning about the potential effect of the services tax on our industry in the state of Michigan, IWLA hired state lobbyist Jim Cavanagh. His leadership and knowledge were second to none throughout our efforts. Without his knowledge of the state legislative process and his relationships with the legislators themselves, our battle would have been impossible. Jim organized "teams" of our members to meet with legislators, with a grand total of 70 legislators seen in an approximate six-week time period.
- Our next step was putting together a study outlining the possible economic effects of the tax on our industry. A 45-page study was quickly commissioned through Michigan State University. "This study was important due not only to the information provided by the 40 industry companies that were surveyed, but also because it became an effective tool in arguing our case to state legislators. The study literally boosted our credibility," said John Zevalkink of Columbian Logistics Network in Grand Rapids.
- Upon hearing of the potential effect of the tax, IWLA formed a steering committee consisting of Bob Koerner of Total Logistic Control (TLC), John Evans of Evans Distribution, Dave Rumler of Exel Logistics, Les Brand of Supply Chain Solutions, Glen Merkel of Davis Cartage and John Zevalkink of Columbian Logistics Network. This group, along with Jim Cavanaugh, Joel Anderson and IWLA staff met by conference call one or two times per week after October 1. They provided regular updates on lobbying efforts and any information that might have been coming from Lansing regarding the tax issue. This committee brought legislators directly to their facilities to show them our industry "at work", and identified two key legislators who assisted greatly in allowing our fight to be heard: State Representative Steve Bieda (D) and Senator Mark Jansen (R-Grand Rapids).
- Communication on the issue was very thorough. IWLA's Legislative Action Center web site and the www.nowarehousetax.com site generated approximately 10,000 letters and e-mails to state legislators regarding the tax issue. Special thanks to Bob Koerner's tech staff at Total Logistic Control for the creation of the "No Warehouse Tax" web site. Legislators told Jim Cavanagh that they had never experienced an issue with as much communication to constituents as this one. Not only was a web site created specifically to fight the tax, but there were several editorials written and extensive press coverage as well. Members of the Steering Committee were quoted in the Detroit Free Press, the Detroit News and also on National Public Radio (NPR). A Grand Rapids television station also visited John Zevalkink at Columbian Logistics' office to conduct an interview. In addition, industry efforts were also recognized in several logistics trade press articles over the course of the past few weeks.
SOURCE: International Warehouse Logistics Association