Michigan House Bill HB5138

Michigan 2025-2026 Regular Session

• Introduced: 10/28/25
• Refer: 10/28/25

Caption

Taxation: administration; administration of certain accommodation taxes; provide for. Amends title & secs. 13, 19 & 30a of 1941 PA 122 (MCL 205.13 et seq.). TIE BAR WITH: HB 5139'25, HB 5140'25

Impact

The bill modifies existing regulations to grant the Department of Treasury additional responsibilities regarding the collection of various taxes, including city income taxes and accommodations taxes on behalf of local units of government. This change could potentially result in increased revenue for municipalities and the state by improving compliance and efficiency in tax collection processes. Additionally, the bill addresses regulatory frameworks associated with joint tax returns, emphasizing the necessity for cooperative compliance between spouses concerning tax liabilities.

Summary

House Bill 5138 aims to amend the Michigan Revenue Collection Act to enhance the administrative efficiency of tax collection by the Department of Treasury. One of the central features of the bill is its focus on enabling the department to more effectively administer and enforce city income taxes and the accommodations tax, especially for those local units that engage the department's services. By clarifying the powers and duties of the treasury in relation to tax collection, the bill seeks to streamline processes for both local governments and taxpayers, ensuring that the mechanisms for collecting and remitting taxes are clear and efficient.

Contention

Concerns regarding the bill primarily revolve around the potential for increased bureaucratic oversight and the implications for local control over fiscal matters. Opponents may fear that centralizing tax collection authority could diminish local governments' ability to tailor tax policies to their specific needs. Moreover, provisions that manage how joint tax refunds are allocated between spouses may also prompt debate, particularly regarding the fairness of the liability allocations, which could affect non-obligated spouses adversely if adequate protections are not in place.