Service tax perplexes area business owners
October 10, 2007
TRI-CITY AREA — Local business owners affected by the state's new 6-cent sales tax on certain services, remain uncertain about the potential impact the tax will have on their respective bottom lines.
For John Brozowski, owner of American Tree Inc., a landscaping and garden supply business on Van Dyke Rd. in Almont, the news of an extra tax couldn't have come at a worse time.
"It's just awful," said Brozowski. "We're already in a three-year slump. There seems to be no such thing as making a profit anymore, and now they're adding a 6-percent service tax."
While he has yet to consult with his accountant, Brozowski is presuming that at least some of American Tree's services will be affected by the tax.
"We don't know all the details yet," said Brozowski, "but we expect it will apply to some of our services. We're fearful it will discourage some of our customers.
"I don't understand how the legislature singled out some services and others are exempt from the tax," he added. "Apparently our lobbyists weren't as effective as those for some other services. I think a 1-percent tax on all services would have been much fairer."
Sue Adamczyk, owner of Fire Island Tanning at 121 S. Main St. in Almont, is having a tough time fathoming why tanning salons are on the list of services subject to the tax.
"I don't know who thought of this, but it's one of the stupidest ideas they could have come up with," said Adamczyk. "It's like a bloody band-aid approach to the whole situation."
Although she, too, needs more time to ascertain the tax's affect on her business, Adamczyk believes the impact could be minimal.
"With tanning services, we have a lot of leeway with our pricing," she said. "It is not regulated by the state, so we set our own prices.
"I don't know how the state is going to be able to oversee this," she continued. "It doesn't make any sense. But at least we have until December 1 to decide what to do about it."
Erica, the manager at Northern Lights tanning salon at 418 E. Third St. in Imlay City, said an upcoming meeting with owner Gary Stoldt will establish any changes on tap for the business as it relates to the tax.
"We had never charged a tax on tanning services before," she said. "We plan to go over things at our meeting. It's weird to be telling people our regular rates and then saying, 'plus tax.'"