In Fiscal Year (FY) 2011, Michigan collected $36.1 billion in state and local taxes. While this is an impressive sum of money, it tells us little about whether or not the average Michigan taxpayer can afford this level of taxation.
As shown in the charts below, Michigan’s state and local tax burden (tax collections divided by personal income) was the twenty-fifth lowest in the nation for FY 2011 at 10.1 percent—or 3.1 percent below the national average of 10.5 percent. Michigan’s tax burden has grown over time by 35.6 percent to 10.1 percent in FY 2011 from 7.5 percent in FY 1950.
Michigan’s lower than average state and local tax burden is driven by their low individual income tax burden (1.9 percent, 33rd highest), corporate income tax burden (0.2 percent, 35th highest), and low all other taxes burden (1.6 percent, 42nd lowest). However, Michigan does have a significant property tax burden (3.8 percent, 15th highest) and sales tax burden (2.7 percent, 18th highest) that partially offsets the lower tax burdens.
Note: FY 2012 tax data from the U.S. Census Bureau will not be available until later in 2014 because FY 2012 was part of their comprehensive “Census of Governments” that is done every 5 years (on years ending 2 and 7). Rest assured that Key Policy Data will post the FY 2012 as soon as it becomes available.
Scott has nearly 20 years of experience as a public policy economist. He is the author, co-author and editor of over 180 studies and books. His professional experience also includes positions at the American Conservative Union Foundation, Granite Institute, Federalism In Action, Maine Heritage Policy Center, Tax Foundation, and Heritage Foundation.