Detroit released its latest tax revenue estimates and economic outlook on Feb. 13 at the semi-annual Revenue Estimating Conference. The city had a steady increase in tax revenue and a strong economic outlook, according to city officials and economists.
Detroit’s tax revenue is expected to grow nearly $40 million this fiscal year. Its general tax revenue fund is estimated to rise to $1.42 million for fiscal year 2026, up $39.4 million from last year. The estimates are produced by the Office of the Chief Financial Officer. Detroit uses this revenue to fund a variety of city services, including emergency response, road maintenance, and city offices.
The increase in tax revenue is a result of increased online gaming and sports betting, in addition to rising property values. Compared to last year, Detroit saw a $39 million increase in wagering taxes, a $9.3 million increase in property taxes, and a $1.7 increase in utility taxes.
Income tax remains the largest source of tax revenue, followed by wagering connected to Detroit’s three casinos — MGM Grand, Greektown, and MotorCity.
Also presented at the conference was Detroit’s economic forecast for 2025 to 2030. The forecast was prepared through a partnership between the City of Detroit, Michigan State University, Wayne State University, and the University of Michigan.
Gabriel Ehrlich, director of the Research Seminar in Quantitative Economics at the University of Michigan, presented the forecast. He said Detroit’s economy remained resilient despite federal policy uncertainties.
“There have been some headwinds to growth, but we do think that over the longer run, first off, you know, Detroit's economy has shown impressive resilience,” Ehrlich said. “And we also think that over the longer term, policy should be somewhat more supportive for growth in Detroit.”
Uncertainty surrounding tariffs and how they may impact U.S. automakers was a big concern for Detroit’s economy since President Trump took office. However, according to Ehrlich, if tariffs are maintained as they are, they may eventually lead to a small bump in domestic auto production, despite increasing prices for consumers.
“With the recent changes in tariff policy, we now estimate that the tariffs will provide a slight boost if they're maintained over the next several years to domestic auto production. So they are pushing up prices for consumers, but we do expect them to provide, you know, a small boost to domestic auto production,” he said.
Ehrlich also said the federal government’s pivot away from electric vehicles may “impose some pain in Michigan.” He noted the 1,220 layoffs last year at General Motors’ Detroit-based electric vehicle plant, called Factory Zero.
He tried to calm worries about Detroit’s labor market and unemployment rates going forward, noting the trend was not specific to Detroit.
“Overall, we believe that Detroit's labor market softened over the course of 2024, but began to stabilize in spring of 2025. And I want to say, you know, Detroit was not alone in the softening trend in 2024. Every county in Michigan experienced a rise in its unemployment rate between the start of 2024 and the start of 2025,” Ehrlich said.
However, he said he worried about the impacts of President Trump’s immigration crackdown on Michigan’s workforce.
“We really do look to, especially for population here in Michigan, we look to people coming in from abroad, internationally. And I think there are obviously major questions about what the long-term path looks like there, so that I think is a risk,” he said.
The revenue conferences must be held twice a year, according to state law. This allows the city to set the amount that is available to be budgeted over the next four years and determines how much money is available for the city’s next budget.
