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Dark Store Issue comes to Houghton

HOUGHTON – The Dark Store tax issue has had devastating effects on community economies all across the State of Michigan, and has met with opposition from many of those communities, with little success to date.

On the state level, opposition to the Dark Store tax loop hole has gained bipartisan support from many politicians. In September, 2015, State Representative Scott Dianda (D), introduced House Resolution 0133, urging the Governor and State Tax Commission to conduct a statewide impact study on the current and future effects of the “dark store” tax method.

In April, 2016, Republican Rep. David C. Maturen along with 26 other sponsors, introduced House Bill 5587, which would amend the Tax Tribunal Act to spell out the criteria that must be applied in an assessment dispute before the “Entire Tribunal” as to the true cash value of real or personal property, according to the wording of the bill. The bill stems from recent decisions on taxpayer appeals of property assessments by large retail stores (so-called big box stores), and similar commercial properties, and the kind of “comparable properties” used in making such decisions.

“We can’t look at it as it’s just these big corporations and businesses,” Dianda said. “This could be a franchise business, like a McDonald’s, or it could come down to an auto parts store. It can come down to the smallest thing that we’ve got.”

Dianda explained that through the constitutional language of the MTT, the tribunal possesses the ability to give big box stores tax reductions, or “carve-outs.”

He said the tax tribunal defends its actions of awarding business tax reductions by saying it is legal for businesses to do it.

“So, what we’re trying to do is support Representative Maturen’s legislation to stop that loophole,” Dianda said. The bill, however, would not alleviate the problem entirely.

“(The bill) would do nothing to what’s happened in the past, it would only stop future people from (filing for appeal),” he said. “The ones that already got the carve-out, they’re going to still continue to get the carve-out. We’re just trying to stop the bleeding from this point forward.”

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