The State of Michigan, in a severe budget crisis, has approved an expansion of its 6% sales taxes on a number of previously un-taxed services.
“Starting Dec. 1, lift tickets at Michigan ski resorts will be taxed 6%. Fees to play golf or to bowl won’t. Personal fitness training will be taxed, too. Fitness centers won’t. The TV repair guy will charge tax. Cable and satellite providers won’t. Businesses will have to pay taxes on consulting, landscaping and janitorial services. But not for lawyers, lobbyists and accountants. Weird? Two lawmakers in the middle of final negotiations to extend the state’s 6% sales tax to many services as part of the solution for the state’s $1.75-billion budget deficit said they tried to focus on services not used by low and middle income people. But they acknowledge the result is muddy — produced by sleepy legislators in marathon, pressure-packed sessions last weekend aimed at avoiding or quickly ending a state government shutdown.”
Among the services “not used by low and middle income people” that made the list are fortune-telling, astrology, numerology, palm-reading, psychics, and phrenology. A situation that isn’t exactly thrilling local practitioners of such arts.
“Of course, I don’t want it. Nobody wants it,” said Okemos astrologer and psychic Lynne Crandall, who will pass along the bookkeeping work to her accountant. “But I’ll get in line with what I’m supposed to do.” Crandall, who writes an astrology column for NOISE, a weekly publication of the Lansing State Journal, said she knew Granholm would be forced to make some tough calls on taxes. The governor’s astrological chart showed she has a moon in the sign of Capricorn, she said, which means “financially, she’s a really tough cookie, and she would make sure all the bottom lines are covered.” “I just pray the state returns to some kind of financial health so we don’t have so many people leaving,” Crandall said.
Metaphysical shops in Michigan who offer psychic readings and other related services will also feel the pinch.
“Mona Lindsay, co-owner of Wisdom of the Ages in Howell, said she’s equally perplexed as to why psychic readings and the related services her business offers will be taxed. The business charges $35 for a 30-minute psychic reading, and the same amount for Tarot card readings. The tax comes to $2.10 per reading. “I thought that was just ridiculous. I was totally shocked when I was listening to the news yesterday morning that that stuff would even be taxable,” Lindsay said. Lindsay said she didn’t think that amount of service tax will boost Michigan’s overall tax base. She said she’ll be meeting with her business partner to re-examine how they charge for readings.”
Defenders of the tax expansion say that they are only taxing “nonessential” services used primarily by high-income people. However, anyone who has met or frequented tarot or psychic practitioners know that these fields are filled with lower- and middle-income people catering to those of similar socioeconomic backgrounds. Services that are used often by the upper classes, like country clubs, lawyers, licensed stockbrokers, lobbyists and accountants are immune to the new tax expansion. Much of the list defines services that legislators apparently feel people shouldn’t use. Despite the claims of defenders, this expanded list is regressive in nature and doesn’t really increase the tax burden of the rich.