Granholm and
Michigan Single Business Tax (SBT). The tax
billion sales tax increase to close a budget gap
was generally hated by businesses, and there
in 2007. The plan was rejected, and the gover-
the legislature
was wide agreement that it should be repealed.
nor replaced the expected revenues by increases
agreed to replace
In 2007, Granholm and the legislature agreed
in personal income taxes and the MBT. The top
the SBT with
to replace the SBT with the Michigan Business
personal income tax rate was increased to 4.35
Tax (MBT), but the new tax is turning out to be
percent, and a tax surcharge of 22 percent was
the Michigan
just as complex and unpopular as the SBT, and
imposed on the MBT. Granholm's fiscal record
Business Tax
it may cost businesses more money. In other tax
also includes a large tax increase on cigarette
policy initiatives, the governor proposed a $1.5
consumers.
(MBT), but the
new tax is turning
out to be just as
complex and
unpopular as
Minnesota
the SBT.
Tim Pawlenty, Republican
Legislature: Democratic
Grade: B
Took Office: January 2003
Tim Pawlenty pledged not to raise taxes
erty tax increases, but he has not focused on
when he ran for governor, but his tax record in
pro-growth tax rate reductions. Nonethe-less,
office is more mixed than that. He backed a
Pawlenty's veto record is impressive, including
$200 million tax increase on cigarette con-
rejecting a gasoline tax increase, a hike in the
sumers in 2005 and a $109 million corporate
top personal income tax rate, and various
tax increase in 2008. He has also supported
bloated spending bills. Pawlenty has delivered
substantial increases in fees and charges.
fairly restrained budgets over the years and
Pawlenty has provided some targeted tax relief
kept spending growth to modest increases.
and imposed temporary limits on local prop-
Mississippi
Haley Barbour, Republican
Legislature: Democratic
Grade: D
Took Office: January 2004
increase taxes on hospitals by $90 million,
Former Republican Party chairman Haley
claiming that "it's a good, fair deal that taxes
Barbour won the governorship in 2004
the hospitals, not our citizens--and rightly
promising to cut spending, veto tax increases,
so."33 Sadly, many governors don't seem to
and create a pro-growth business environ-
ment. Barbour has proposed some small, tar-
appreciate that the business tax burden ulti-
geted tax breaks over the years and blocked
mately lands on individuals. Barbour's bud-
some tax increases proposed by the legisla-
gets have proposed some reforms, but per
ture, but he has not pursued substantial tax
capita spending has risen at more than than
cuts. This year Barbour is proposing to
8 percent annually since he took office.
18