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Michigan legislature clears casino tax hike
August 5
Last night in Michigan, the
state Legislature voted in favor of increasing the tax on
Detroit's three casinos. The vote was to increase the tax by
one third, with plans to put aside part of the new revenue
for agricultural programs.
In a vote of 30 to 6 from the
Senate, and a House vote of 93 to 15, the bill now
goes to Gov. Jennifer Granholm, who is said to believe this
is necessary step towards balancing and solving the states
budget.
The new bill would increase
taxing of the Detroit casinos from 18% to 24%. With this tax
increase, it is said that an additional $50 million in
revenue will be brought to the state in the next fiscal year
that starts on October 1.
As far as the money set aside
for agricultural issues is concerned, the details are yet to
come. The total set aside is to be approximately $6 million.
This bill is said to, in
part, reflect on an effort to compromise with certain House
Republicans who are strong supporters of a bill allowing
horse tracks to install slot machines and other types of
gaming devices in order to raise money for agricultural
interests.
The approved bill is to
include a provision that will cancel the increase if horse
tracks are allowed to have the slots and other machines
installed. Additionally , the bill has a motivational
incitement for the three casinos (MGM Grand, Motor City, and
Greektown) to construct hotels.
Fighting back against the tax
increase, the casinos fear it will cost workers their jobs,
and cause the economic development in Detroit to stall.
With a $1 billion deficit
facing Michigan down next year, it is likely this is a move
the state must make.
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