The Senate passed HB 4361. This is the legislation that repeals the Michigan Business Tax and creates a new 6% Corporate Income Tax on C-Corporation businesses in Michigan.
This bill had a series of very controversial amendments offered in the Senate by the Democrats, and all amendments were rejected. The Lieutenant Governor was forced to break the tie (19-19) several times on amendments dealing with eliminating the newly created pension tax.
The House is expected to concur in the changes made by the Senate in about an hour, and will send the bill to Governor Snyder for his signature. The Governor will sign the bill, although timing is uncertain at this time. The bill has immediate effect.
Brownfield and Historic credits were eliminated in the MBT repeal, and were NOT included in thenet CIT bill. Chris Miller from the City of Adrian joined me in testifying in Senate Committee yesterday about the need for either credits to be retained or the alternative to be appropriately funded. With the CIT passing without the credits, the League will continue to push for the Legislature to appropriately fund the replacement in the budget negotiations. Without that happening, this important tool to create jobs and private investments will be lost to Michigan communities.
HB 4362 was also passed. This bill will allow developers who have received Brownfield and Historic credits to retain those credits if they continue to file the Michigan Business Tax. It will also allow them to sell their existing credits back to the state at 90%. This was negotiated with several developers, and they agreed that 90% would work so they supported the legislation. The League was involved with the discussion, but said that they would defer to the developers for the best language to ensure that the projects actually happen.
Andy Schor is the Assistant Director of State Affairs for the Michigan Municipal League. Contact him at (517) 908-0300 or by email at email@example.com.
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Source: City of Detroit