Tag Archives: business

Healthcare thoughts

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I offer healthcare to keep workers working for me — it’s an employee retention benefit that helps cover the cost of training. As it is now, if they quit, covered workers will have to pay for their own heathcare or find another company that’s willing to pay for it.

Perhaps that’s mean to think this way, but it’s really my only means to keep people from jumping shop at the first higher-paying opportunity. Anyway, that’s what I do/did. When congress gave free healthcare to everyone as of this year, they not only raised my taxes, and my company taxes, they also removed a key tool I have for keeping people on the job. In return, I suppose my healthcare fees are supposed to go down, but I have no faith they will, in part because I worked for the government and have no faith in their ability to be efficient or fast moving; in part because my ability to pay for healthcare comes from my ability to keep trained workers.

Though I’m not too happy about the change, I imagine (hope) that my employees are happy. Their  taxes will go up a bit, but they will be more free to jump ship at will. I imagine that the unemployed are especially thrilled, though I don’t know why that was not implemented through an increase in Medicare and Medicaid. In a sense I’m surprised it took congress this long to give everyone “free” healthcare without forcing them to work for it.

Michigan tax wrongs righted

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This month, at last, the Michigan legislature began to take seriously the job of correcting some tax wrongs that needed correcting for years. The most important change: they decreased the tax on business property (only by 10% but it’s a start) and shifted the burden to a tax on business profit.

The personal property tax was paid on any equipment, inventory, or supplies that a business kept in-house. No matter if their were sales or none, a tax was due so long as a business had equipment or unsold inventory. Even in years where there were no profits or sales, money was due to the state — a tax on your dreams of somehow making a go of things. Aside from its complexity of valuing your unused supplies and inventory, the tax guaranteed that struggling businesses would fail — immediately. The governor (Granholm – glad she’s gone) claimed that taxing unused equipment and inventory protected the state coffers from the ups and downs of the business cycle, but the state was is far better shape than a struggling business when it came to the cost of borrowing. Besides, I’m not sure she was doing Michigan any favors by destroying businesses that were barely hanging on.

Governor Granholm (thank G-d she’s gone) gave out the money she collected to the right sort of people, her friends, and to targeted businesses that she liked: e.g. movie makers who made money-losing, dystopian films and left as soon as the checks cashed. The current governor, Snyder claims his aim is to eliminate the business property tax in 10 years, 10% at a time. I hope, we’ll see.

Another tax that’s now gone, at last, is the 0.8% on transactions between businesses. It wasn’t an unfair tax like the property tax, but was annoying to keep track of. What a mess. Keep up the good work, lads. Now if only they can do something about Detroit’s uncommonly high minimum wage.

Robert Buxbaum, November 20, 2012