November 2007 Field Report -
Southeast Michigan
By: Tony Daunt – Southeast Michigan Field Director
Earlier this month, the House passed legislation, in the form of House Bill 5408, repealing the service tax along with identifying a new revenue source to replace funds the service tax would have brought in. House Bill 5408 moved to the Senate, where it was amended to more evenly dispense the tax liability among large and small businesses. As passed, House Bill 5408 will affect those businesses that will pay the new Michigan Business Tax (MBT) by adding a surcharge. Highlights of the amended version of the bill include:
- Cutting the MBT surcharge in the House-passed version from 32.9% to 13.85%
- Uses excess state revenue from the personal property tax to pay down the surcharge amount
- Sunset the proposed permanent surcharge on January 1st, 2011
- Raise the cap on surcharge liability from $2 million to $5 million
The MAR supported a timely repeal of the tax, but urged a more broad based and equitable solution should the revenue be replaced. The Senate amended version of House Bill 5408 goes a long way in accomplishing this aim. Governor Granholm has stated that she will not allow the repeal without revenue replacement. House Bill 5408 now heads back to the House for a vote. Should this bill pass the House, it will be sent off to the Governor’s office to either become enacted, or vetoed. Although legislative leadership is in continuous discussions on how to resolve the issue, the biggest contention point in the new plan points to the sunset on the MBT surcharge. The service tax is scheduled to go into effect on Saturday, December 1st if a change or delay is not passed this week.
The MAR Advocacy team is in continuing talks with legislative leaders to make certain that the real estate industry interests are protected from any new tax solution. We will continue to provide our membership updates on the issue.
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November 2007
Field Report
• Field Report
Tony represents:
• Ann Arbor Area
• Dearborn
• Detroit
• CBOR
• Down River
• Grosse Pointe
• Lenawee County
• Livingston County
• MCAR
• Monroe County
• North Oakland County
• Western Wayne Oakland County
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