Jun 29, 2007
The Michigan Business Tax (MBT) that replaces the Single Business Tax (SBT) that brought in $2 billon in revenue to Michigan’s shrinking general fund budget that accounted for 25 percent of that budget passed in both the House and Senate with bipartisan support on Thursday.
However, two of the three Livingston County lawmakers voted no on Senate Bill 94, and Reps. Chris Ward and Joe Hune demonstrated once again they are out of step with the rest of the state. The MBT passed in the House 75-34. All the Democrats in the House voted for the bill, and 16 Republicans also voted for it.
It had even more support in the Republican-controlled Senate where it overwhelmingly passed 32-3. All three no votes were from Republicans. Sen. Valde Garcia, R-Howell, voted for the bill.
The bill ends months of business uncertainly that scared off investors to the state. Governor Jennifer Granholm said the new MBT would make Michigan’s business climate competitive that will attract jobs and job providers. The new structure provides tax cuts for more than seven out of ten Michigan businesses and provides tax cuts to both small businesses and Michigan’s major manufacturers. It is a fair, simple tax that will provide the same amount of revenue as the Single Business Tax it replaces, while encouraging job creation in Michigan.
The Associated Press said the agreement includes incentives that reward businesses for investing in Michigan and creating jobs, with out-of-state companies that have sales in Michigan paying more taxes. The bill could help domestic automakers and large manufacturers by lowering personal property taxes they pay on machinery and equipment by about two-thirds.
Manufacturers, especially auto manufacturers, are getting absolutely zero support and help from Washington, D.C. on free trade agreement enforcement and heath care, and the MBT will help some.
Why Ward and Hune voted no is a mystery, but Ward did make a statement on the House floor.
“This new Michigan Business Tax is a serious mistake,” he said. “It contains special carve-out treatment for certain businesses and it is more complicated than the burdensome Single Business Tax it replaces.”
I think quite a few of your fellow Republicans disagree with you, Chris.
You will recall the GOP-controlled Legislature irresponsibly voted last August to eliminate the SBT at the end of this year, two years earlier than planned, without a replacement in site. The move had immediate negative effects, and it led Standard & Poor's to lower the state's rating on general obligation bonds to "AA” costing the state more money to borrow funds for any reason. It also created uncertainty as businesses looking to relocate avoided Michigan because of the uncertainly over what the main business tax would be while Senate Majority Leader Mike Bishop threw up delay after delay in reaching a replacement.