MEGA/SBT TAX BREAKS H.B. 5445 (S-1): FLOOR ANALYSIS
House Bill 5445 (Substitute S-1 as reported)
Sponsor: Representative Bill Huizenga
House Committee: Commerce
Senate Committee: Commerce and Labor
CONTENT
The bill would amend the Single Business Tax (SBT) Act to require the Michigan Economic Growth Authority (MEGA) to report to the Legislature on an SBT credit for qualified jobs with a "distressed business". The bill also would change citations to a section of the MEGA Act in provisions regarding SBT credits based on qualified new jobs.
Under provisions added by Public Act 251 of 2003, the SBT Act provides for a tax credit in tax years beginning after December 31, 2003, and before January 1, 2007, for a distressed business. The SBT credit is for up to 50% of the tax paid under the Michigan Employment Security Act based on qualified new jobs under the MEGA Act and up to 25% of the tax paid under the Michigan Employment Security Act based on all other jobs. House Bill 5445 (S-1) would require MEGA to report to the Legislature by September 1, 2004, on the status of implementing the distressed business SBT credit; the number of businesses that had applied for the credit; and the number of certificates issued for the credit.
In addition, the SBT Act refers in several places to a taxpayer claiming a credit based on qualified new jobs as defined in Section 3(j) or Section 3(k) of the MEGA Act. The definition of "qualified new jobs", however, appears in Section 3(n). The bill would refer to that section.
(Under the MEGA Act, a "distressed business" is a business that meets all of the following:
-- Four years immediately before applying to MEGA for an SBT credit, the business had 150 or more full-time jobs in Michigan.
-- Within the immediately preceding four years, there has been a reduction of at least 30% of the number of full-time jobs in Michigan during any consecutive three-year period.
-- The business is not a seasonal employer as defined in the Michigan Employment Security Act.)
MCL 208.37c Legislative Analyst: Patrick Affholter
FISCAL IMPACT
The bill would have no fiscal impact on State or local government.
Date Completed: 3-29-04 Fiscal Analyst: David Zin
floor\hb5445 Analysis available @ http://www.michiganlegislature.org
This analysis was prepared by nonpartisan Senate staff for use by the Senate in its deliberations and does not constitute an official statement of legislative intent.
Analysis was prepared by nonpartisan Senate staff for use by the Senate in its deliberations and does not constitute an official statement of legislative intent. hb5445/0304