Individual income tax: revenue distributions; earmark of withholding tax capture revenues into the more jobs for Michigan fund; provide for. Amends secs. 51f & 711 of 1967 PA 281 (MCL 206.51f & 206.711).
Summary
SB 472 amends Michigan’s Income Tax Act to redirect certain withholding tax capture revenues into two economic development funds tied to the state’s job-creation incentive programs. Specifically, it requires revenue attributable to certified new jobs under chapter 8D agreements to be deposited into the Good Jobs for Michigan Fund, and revenue attributable to certified new jobs and protected jobs under chapter 8F agreements to be deposited into the More Jobs for Michigan Fund. The bill also updates the statutory cross-references and definitions used for those programs.
The bill further revises employer withholding reporting requirements. Employers with written agreements under the Good Jobs for Michigan program must identify, in their withholding returns or reports, the portion of withheld taxes attributable to certified new jobs. The bill also preserves existing reporting rules for employers with community college agreements and for large employers filing electronically, while leaving the general withholding and employee information rules intact.
Impact
The bill would amend sections 51f and 711 of the Income Tax Act of 1967, changing how certain income tax withholding revenues are distributed and how participating employers report those amounts to the Department of Treasury. Its practical effect is to earmark a portion of withholding tax capture revenues for the More Jobs for Michigan Fund and the Good Jobs for Michigan Fund, reinforcing the financing structure for Michigan Strategic Fund job incentive agreements. It would also impose a more specific reporting obligation on employers participating in the Good Jobs for Michigan program so the state can track the tax amounts associated with certified new jobs.
Sentiment
The available voting history suggests the bill was received favorably in committee, passing 7-0 with a favorable substitute report. No committee transcript was provided, but the unanimous vote indicates broad support among the members who voted. The bill’s structure, which aligns tax administration with existing economic development programs, also suggests it was viewed as a technical or program-supporting measure rather than a controversial tax increase.
Contention
No direct points of contention appear in the provided materials, and there were no recorded committee remarks to indicate disagreement. Potential areas of concern, based on the bill’s subject matter, could include the diversion of tax revenues into dedicated funds and the added compliance/reporting burden on participating employers. However, the unanimous committee vote suggests any such concerns were not significant enough to prevent favorable reporting.