Advocacy News – Sept. 18, 2025
What’s new: The future of business tax breaks in the federal One Big Beautiful Bill Act (OBBBA) is emerging as a flashpoint in the ongoing budget negotiations between the House, Senate and Governor.
Why it matters: One proposal would “decouple” state taxes from federal reforms in OBBBA — resulting in higher state taxes on Michigan employers. The MI Chamber and other business groups voiced strong opposition this week.
Our concerns:
- Lost benefits: Michigan businesses would lose the benefits of the federal tax changes on their state-level tax returns.
- Competitive disadvantage: Employers here would be penalized compared to peers in states that have not blocked the changes.
- Missed investment: As reshoring gains momentum, Michigan could lose projects to states that welcome the federal incentives.
- Undone progress: Decoupling would wipe out Michigan’s new R&D Tax Credit, enacted this year and set to be claimed in 2026.
The bottom line: Decoupling is a step backward that would undercut growth, innovation and competitiveness just as Michigan needs them the most.
Go deeper: Read the business community’s letter to lawmakers and the Governor.