Michigan stupidity

The Michigan Department of Treasury has released the NAICS codes for the specific industries affected by the new service tax. As it happens, my principal NAICS codes, 541512 and 541511 are not covered by the new service tax. But to show how aribtrary the new tax is, if I were to provide the exact same type of services, but with a focus on physics, I would have a NAICS code of 541690, which is covered by the new tax. Why should a physicist be penalized for performing the same basic service?

I have a suspicion that many companies that are on the edge of multiple NAICS codes will reorganize their operations so that they fall into an exempt service category. And others will move their offices to Ohio, where they can continue to provide services to southeastern Michigan customers, but remain outside of this service tax madness. I'm sure that the State of Michigan will have the same "success" with voluntary use tax compliance as they do with physical goods.

If you are a company seeking to hire a consulting firm to assist you with your process management (541614), are you going to outsource the contract to a company in Michigan that charges $106 per hour ($100/hour + 6%), or to a company in Illinois that only charges $100 per hour? After the company in Michigan goes out of business, the State of Michigan will face budget shortfalls, as those ex-workers will no longer be paying income taxes.