"Dark stores" tax discussion continues in Michigan

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By Riley James
The Meridian Times Staff Reporter

Kohl's in Okemos. Photo by Riley James

Kohl’s in Okemos.
Photo by Riley James

The Michigan Tax Tribunal has had many discussions about passing a law that will lower the taxes of big-box stores like Kohl’s, Meijer, and Walmart. These discussions and proposed bills have been referred to as “dark stores.”

“What is being discussed is the proper evaluation and taxation of large, retail stores,” said Tricia Kinley, the senior director of the Michigan Chamber of Commerce. “‘Dark stores’ is really just lingo. It’s a topic. It’s been coined as ‘dark stores.’ It’s really more of a debate, and it’s a topic that is going on.”

The dark stores discussion is to assess and tax the big-box stores fairly because many corporations and representative groups, including the Michigan Chamber of Commerce, feel that the stores are being over-taxed.

“There have been a few pieces of legislation that have been introduced to change how these retail stores are assessed, but those bills, so far, have been very controversial. The issue keeps being discussed in the legislative process, but a bill has not passed yet,” said Kinley. “Dark stores is an issue, and the issue is: what is the proper way to value and tax large retail stores?”

Since this dark store discussion began, property taxes of corporate businesses have decreased.

“[The property tax] used to be more helpful before [the corporate businesses] went to the tax tribunal and reduced their values. They got a really big reduction in property value,” said the treasurer of Meridian Township, Julie Brixie.

The corporate businesses realized that if they leave the building they are located at, it would be very difficult for the township to sell the big building to another business. Because of this, they felt they were being over-taxed.

“All of the large, big-box companies in the state went to the tax tribunal because the Republican legislature appointed a tax tribunal that will let them say, ‘you should consider that this store would be really hard to fill if we were to leave here and it isn’t worth as much as you say it is,’” said Brixie.

According to Zack Saylor, the assistant store manager of the Kohl’s in Okemos, the corporate branch of the business handles the property tax, and no one that works at this specific Kohl’s has a say in the dark stores discussion. Saylor thinks Kohl’s deserves their tax rates to be lowered because they give back to the community in other ways.

The location of some of the big, box stores that would be affected by the dark stores discussion.

The location of some of the big-box stores in Okemos that would be affected by the dark stores discussion.

“[Kohl’s] gives back [to the community] by having AIA, which stands for associates in action, events. We go to Michigan State basketball games, we go to YMCAs and give back to charities, [and] we go to different organizations and devote our time to help out the best way we can,” said Saylor.

According to Kinley, the Michigan Tax Tribunal has consistently sided with big-box stores and thinks they are being over-taxed.

“The point is that every taxpayer in Michigan, rather they are a retailer or a homeowner, deserves to be assessed and taxed fairly and accurately,” said Kinley.

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