3/7/07

The State Bar of Michigan opposes any legislation that imposes a tax on legal services. Legislation introduced March 1 in HB 4368 by Representative George Cushingberry Jr. and SB 307 by Senator Liz Brater contains provisions for such a tax.

“The proposed tax places an additional burden on individuals in times of acute distress and crisis, making it a true misery tax,” said Kimberly M. Cahill, president of the State Bar. “We know that among low-income individuals, for every four people who are able to get low-cost legal services, three cannot. Michigan lawyers already give generously of their time and money to support legal aid services or discounted services for those who cannot afford to pay, but the need is still overwhelming. Adding another cost, even at two cents on the dollar, is simply wrong.”

Filings in Michigan state courts show that most legal services are not discretionary and are sought by individuals in times of significant emotional and financial stress. The proposed tax would fall on victims of domestic violence seeking personal protection orders, widows trying to collect benefits, terminally ill patients providing medical directives and estate planning, single parents seeking child support collections, or unemployed residents facing bankruptcy.

A tax on legal services also impacts Michigan businesses that need legal services to support their core operations and functions, especially small business owners. Michigan businesses use legal services to ensure compliance with the law, to take proactive and responsible management measures like incorporating, and to seek specific or technical advice.

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