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| TAX OUTLINE |
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| TAX DESCRIPTIONS |
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| STATE CASINO GAMING |
LEGAL CITATION: |
M.C.L. 432.201-432.216; Initiated Law of 1996 |
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| YEAR ADOPTED: |
1996 |
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| BASIS OF TAX: |
Privilege of operating a casino in the City of Detroit. Only three licensees are authorized under Initiated Law 1 of 1996. |
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| MEASURE OF TAX (BASE): |
Adjusted gross receipts received by a gaming licensee. |
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| RATE: |
12.1%. Rate is reduced to 8.1% when a licensee becomes fully operational (See box below). |
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| ADMINISTRATION: |
Michigan Department of Treasury, Michigan Gaming Control Board. |
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| REPORT AND PAYMENT: |
Due daily. |
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| DISPOSITION: |
At the 12.1% rate: 67% to School Aid Fund; 29% to General Fund; and 4% to the Michigan Agriculture Equine Industry Development Fund.
At the 8.1% rate: 100% to School Aid Fund
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| 2006-07 COLLECTIONS: |
$159,333,000 |
State Casino Gaming Tax Rate Reduction
Under Initiated Law 1 of 1996, the casino wagering tax can be levied as a single state tax (at a rate of 18%) or as two separate taxes (a state tax at the rate of 8.1%, and a local tax at the rate of 9.9%). Because the City of Detroit chose to impose a local tax, there are two separate taxes.
Public Act 306 of 2004 (effective September 1, 2004), which amended Initiated Law 1 of 1996, increased the state casino gaming tax rate from 8.1% to 12.1%. Public Act 306 further provided that when a casino became fully operational, a casino can apply for a reduction in the tax rate back to the original 8.1% rate. The MGM Grand Casino and the Motor City Casino became fully operational effective October 2007 and December 2007, respectively. These two casinos are subject to the 8.1% tax rate, while the third licensee, Greektown Casino, continues to pay taxes at the 12.1% rate.
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| State Casino Gaming Tax Law Changes |
Last Updated July 21, 2008
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