Senate Subcommittee Concludes Study of MBT Failings

May 29, 2008
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LANSING — Based on testimony from dozens of business owners and managers around the state, the Senate MBT Impact Assessment Subcommittee announced its key findings Thursday on ways to end complaints about the state’s new Michigan Business Tax.

Key findings:

  • The surcharge added to the MBT continues to have a negative impact, especially on mid-size and large firms that don't qualify for the small business credit and other deductions.

  • There is a lack of adequate information and assistance from the Michigan Department of Treasury on complex tax-compliance issues.

  • Many business owners are unaware they qualify for the small business credit.

  • The inclusion of taxes and fees in the MBT base is unreasonable and has a profoundly negative effect on Michigan-based businesses, most notably retailers.

“With this information in hand we can now work to fix the MBT and remove any unintended consequences negatively effecting Michigan’s job providers. Our goal is to keep and grow our Michigan businesses," said Sen. Mark C. Jansen, R-Gaines Township, subcommittee chair.

“Now that the hearings have concluded we can get down to business and start to correct these problems,” said subcommittee member Sen. Jud Gilbert, R-Algonac.

Bills previously approved by the Senate and awaiting House action would make some changes, such as the removal of sales tax revenues from the MBT base; ensure that casual transactions are not subject to the tax; allow thousands more Michigan businesses to qualify for the Small Business Credit; and exempt materials, supplies and payments to subcontractors from the tax as it applies to builders and contractors.

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