Michigan House Bill HB5296

Michigan 2025-2026 Regular Session

• Introduced: 11/13/25
• Refer: 11/13/25

Caption

Corporate income tax: revenue distribution; distribution of corporate income tax revenue; modify to reflect repeal of the strategic outreach and attraction reserve fund. Amends sec. 695 of 1967 PA 281 (MCL 206.695). TIE BAR WITH: HB 5294'25

Impact

If enacted, HB 5296 specifies that revenue generated under the corporate income tax will first be allocated to the General Fund before being directed to various specific funds. For instance, there are provisions for a $50,000,000 allocation to the Michigan Housing and Community Development Fund and significant allocations to the Neighborhood Roads Fund and Strategic Outreach and Attraction Reserve Fund. These funding initiatives highlight the state's commitment to infrastructure and community improvement, and they will likely affect local government budgeting and planning.

Summary

House Bill 5296 proposes amendments to the Income Tax Act of 1967, specifically focusing on Section 695, which outlines the distribution of corporate income tax revenue in the state of Michigan. The bill aims to establish a clear framework for the allocation of such revenues over the state fiscal years from 2022-2023 through 2029-2030. It emphasizes significant contributions to the General Fund, as well as targeted funding for housing, community development, and infrastructure necessities.

Contention

Throughout discussions surrounding HB 5296, stakeholders have raised points of contention regarding the prioritization of revenue distribution. Supporters argue that the focus on housing and community development is critical for addressing ongoing issues of affordability and accessibility in Michigan. However, critics express concerns that the bill may not adequately address the needs of all areas, especially rural regions, potentially leading to inequities in how funds are distributed. Additionally, the bill's tie-in with House Bill 5294 suggests that its passage may depend on broader legislative support for interconnected revenue measures.