Bills would address Detroit's dwindling population

May 31, 2011

LANSING, Mich. (AP) - The city of Detroit could continue charging a higher income tax rate than other Michigan cities under terms of legislation pending in the state House.

The bills that could come up for votes Wednesday also would affect utility user tax rates in Michigan's largest city.

Detroit likely needs changes in state law to keep some of its current tax rates because it is losing population. Census statistics show that the Motor City's population fell from 951,270 in 2000 to 713,777 last year.

Current state law allows higher personal income tax rates in cities with at least 750,000 people, affecting only Detroit. The law would have to change now that Detroit's population has dipped
below that 750,000 mark.

Detroit now charges an income tax rate of 2.5 percent for residents.