Bill would end ‘dark store’ tax assessments

The Michigan Legislature has only been session a few weeks and already a bill has been introduced to eliminate loopholes for so-called “dark stores.”

The legislation would limit big-box retailers’ ability to appeal their local property tax assessments by arguing their stores must be valued as if vacant, or “dark,” and available for sale to a future property buyer. Currently, large retailers are able to drastically reduce their tax bills by claiming sales of older, vacant buildings should be considered when determining the value of new store properties, according to UP Matters.

State Rep. Beau LaFave, an Iron Mountain Republican, introduced House Bill 4025 on the first day of the 100thlegislative session. It is identical to a bill he co-sponsored in the last session that never made it beyond the House Tax Policy Committee.

The New York Timesreports the Michigan Association of Counties estimated that dark-store appeals reduced local revenue from 2013 to 2017 by $100 million.

Successful tax appeals have a domino effect, analysts say, because each successful corporate appeal drives down not only their own assessments, but the comparative value of other properties as well, according to

“Let’s be clear, the current system is unfair to small retailers who compete against big box stores,” LaFave told the Marquette Mining Journal. “Communities across the Upper Peninsula are being denied tax revenue that is necessary to improve public services. We need a system that ensures fair and sensible retail tax assessments for all businesses, not just a few.”

The measure has bipartisan co-sponsors and was referred to the House Committee on Local Government and Municipal Finance.


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