On Thursday the Michigan Senate voted to provide Personal Property Tax relief to manufacturers and small businesses. Proponents of the bills say Passage of these bills are essential for Michigan to remain a competitive manufacturing state. Several amendments were made to the bills including SB1072 which will now provide additional funding guarantees for local units of government that rely on personal property tax for payout of local bonds.
Personal Property tax is the tax businesses pay on equipment they have for manufacturing products as well as small businesses that pay on counters and cash registers. It is not REAL Property tax that both businesses and homeowners will continue to pay.
This plan is a phase out plan and many of the changes will not take place until economic development incentives expire in 2016 and run through 2021. Most of those tax credits that will expire in 2016 involve MEGA tax break and battery tax credits. When these credits expire that state will receive more revenue from the taxes on those businesses.
Most surrounding Great Lake states removed personal property taxes years ago to allow for businesses to invest in new equipment and product lines.
For more information on each bill use the links provided:
SB 1065 (Brandenburg) Economic development; plant rehabilitation; eligible manufacturing personal property abatement; extend. PA 198
SB 1066 (Robertson) Economic development; other; eligible manufacturing personal property abatement for technology parks; extend. Technology Park Development Act
SB 1067 (Caswell) Property tax; exemptions; existing exemptions for industrial personal property; continue. General Property Tax Act / Next Michigan Development Corporation
SB 1068 (Robertson) Economic development; enterprise zones; eligible manufacturing personal property abatement; extend. Enterprise Zone Act
SB 1069 (Hildenbrand) Property tax; personal property; new industrial personal property; exempt. General Property Tax Act
SB 1070 (Nofs) Property tax; personal property; less than certain value; exempt. General Property Tax Act
SB 1071 (Nofs) Property tax; personal property; industrial personal property; exempt. General Property Tax Act
SB 1072 (Brandenburg) Taxation; other; reimbursement for revenue lost as a result of personal property exemption; provide for. Creates new act: Personal Property Tax Exemption Reimbursement Act