Tax Policy & Finance

On Heels of Federal Tax Reform, Tax Cut Fever Sets Hits State Lawmakers

Discussions about making simple technical changes to the State’s income tax to conform with recent federal changes quickly turned into action by state some state lawmakers to provide Michigan taxpayers with significant tax cuts. 

Below is a list of bills recently introduced to provide Michigan taxpayers some personal income tax relief:

SB 748 (Brandenburg) – Increases personal exemption to $5,000

Chamber Holds Treasury's Feet to the Fire; Backs Legislation to Provide for Refunds on Overpaid Taxes

The primary responsibility of the Department of Treasury is to promote and enforce tax compliance. Taxes owed should be paid -- nothing more, nothing less. Unfortunately, there are situations where taxpayers who overpay their taxes are not able to get a refund on the overage. That is unacceptable and the Michigan Chamber is fighting back!

Chamber Corrects Unfair Deadlines for Filing PPT Exemptions

Chamber-backed legislation to provide fairer deadlines for filing Personal Property Tax exemption forms was sent to the Governor last week. This is great news for filers who currently have no recourse if they fail to meet the February 20th deadline for submitting eligible manufacturing personal property (EMPP) tax exemption claims. The Governor is expected to sign the legislation. 

Chamber-Led Initiative to Exempt Dental Prosthetics from Sales/Use Tax Sent to Governor

After an unexpectedly longer and more complicated journey through the State Legislature, a four-bill package (HB 5173, HB 5164, SB 566 and SB 567) to  re-exempt” dental prosthetics from sales/use tax was sent to the Governor last week for final approval. The Governor has indicated he will sign the bills.

Bills to Address Unfunded Municipal Pension/Benefit Liability Introduced in State Legislature; Chamber Supports Aggressive Action

A 16-bill package aimed at reigning in massive municipal unfunded pension and benefit liabilities was introduced in the both the State House and Senate last week. The Michigan Chamber supports this effort to make sure local governments do everything they can to shore up their liabilities. Failure to handle these massive unfunded liabilities held by local governments could unquestionably fall on Michigan job providers if not dealt with aggressively.

Chamber Hosts Meeting on Installer Sales/Use Tax Liability

As noted in previous editions of Capitol Report, we have seen a significant increase in issues regarding sales/use tax liability on installers or contractors. Under audit, Treasury has been assessing use tax on companies who are only installing items for which the sales tax burden is born by someone else. When able to prove that sales tax was already paid, the liability is absolved, but doing so is complicated.

Chamber-Supported Tax Bills On the Move

Several Chamber-backed tax bills have advanced through the legislative process in recent weeks. Following is a rundown is key tax bills on the move:

Dental Prosthetics (SBs 566-7 and HBs 5164, 5173): Originally only a two-bill package, legislation to “re-exempt” dental prosthetics has expanded to a four-bill package after requests from the Department of Treasury. Two bills have been passed by the House and await committee action in the Senate. The other two bills are on the House floor where their next stop will be the Governor’s desk.