Mich. groups call for higher taxes to save budget

LANSING, MI – A coalition of social service, education and labor groups wants the state to change its tax structure to raise more revenue and prevent deep cuts in the budget year that starts Oct. 1.

The plan released Wednesday includes expanding the sales tax to "non-essential" items such as entertainment and landscaping services to raise nearly $1.7 billion.

The partnership also wants to change the flat income tax rate to a graduated one, raising about $400 million, and end tax exemptions to generate $600 million.

Partners promoting the plan include the Michigan League for Human Services, the Michigan Education Association and Progress Michigan.

Michigan faces a $2.8 billion budget deficit next fiscal year. Republicans and many Democrats are hesitant to back tax increases in a bad economy.