Michigan Cities Vacillate About “Crash Taxes”

We all know that a car crash can wreak havoc with your insurance premium and driving record, even when it’s not you’re fault, but if you’re a tourist visiting the state of Michigan, an accident could cost you money that your insurer won’t pay. Why? Because several cities in Michigan are following Sacramento, California’s lead, and implementing “crash taxes.”

What is a crash tax?

It’s a fee imposed by city governments on out-of-town drivers who cause car crashes, and it’s meant to help recoup the money that individual cities and towns spend on police and fire services when such crashes occur.

Critics of these fees are the ones who coined the term “crash tax,” and they’re also saying such charges are “back-door” sources of revenue.

Examples of such fees include Fraser (a suburb of Detroit) which began collecting them this year. In Fraser, it costs $57.15 per hour of police time spent at the scene of an accident.

If there are enough accidents caused by non-local drivers, these fees could add up, but some cities and towns have decided the earnings aren’t enough to offset the paperwork required, and are dropping them.

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