House Speaker Matt Hall announced the outline of a property tax cut proposal on February 24, 2026, that has been getting quite a bit of press.  A partial sales tax on services would pay for the proposed tax cuts.

Rising property taxes have become a huge concern in Michigan due to inflation, an overpriced housing market due to a dearth of inventory. Most property tax law lies in the Michigan constitution under Proposal A, so legislative solutions are limited. NFIB appreciates the bold approach to eliminate the personal property tax and lower real property, we have great concerns about any expansion of the sales tax to services.

NFIB is working behind the scenes to get all of the details on the proposal and share with legislators how this may negatively affect small businesses.  When we receive all pertinent details as well as a complete list of services affected, we will send out a special ballot to our members to decide whether NFIB should support, oppose, or stay neutral on this proposal.

Proposed tax cuts and reforms:

• Completely eliminate the personal property tax on commercial and industrial businesses (manufacturing has already been eliminated).
• Remove the 6-mill state education tax on real property, which is $6 for every $1000 of real property. The estimated saving for an average homeowner is $900.
• Eliminate the real estate transfer tax and the pop-up tax, which is when residential property is reassessed upon its sale, removing the inflationary cap on tax increases for the prior owner.

The price tag:

• The plan is expected to cost between $4 -$5 billion and is estimated to amount to a $270 million tax cut.
• A partial sales tax on services for “luxury” services.

Examples include limousines, country club memberships, private jets, marinas, tourist services, travel agencies, skiing, golf, artificial intelligence services, newspaper publishing, performing arts, environmental consulting and political ads.

• Exempt everyday services and business to business transactions.

Examples include nail salons, barbers, landscaping, health care services, car repairs, child care, veterinary services, dry cleaning and streaming services would be exempt.