By Staff
COLOMA – State lawmakers Wednesday voted to end the job-killing Single Business Tax, marking the start of an effort to reform Michigan's business tax code and bring jobs back to the state.
For years, the SBT has been a one-of-a-kind tax in America making job providers pay more for each job they create for health care as well as any 401(k) plans they offer.
State Reps. Neal Nitz, John Proos and Rick Shaffer discussed the elimination of the SBT at Regal Finishing Inc. in Coloma, where the petition drive kicked off in April with Oakland County Executive L. Brooks Patterson.
Enough signatures were collected to allow the Legislature to help struggling businesses and spur job growth in Michigan.
"Michigan can no longer afford to take a back seat to other states in economic development," said Proos, R-St. Joseph. "By eliminating the SBT, we not only provide relief for business and industry in our state, but we will finally have an incentive to attract innovative entrepreneurs to Michigan's Great Southwest and the entire state."
The SBT will be repealed on Dec. 31, 2007, as a result of thousands of petition signatures and the Legislature's vote Aug. 9.
"The SBT continues to cut the legs of our businesses, preventing the state from prospering and moving forward toward economic recovery," said Nitz, R-Baroda. "Now that we have repealed the SBT we can implement a stable tax structure that prevents an overburdening grip on our economy to help build a stronger work force."
A report released Monday by the Anderson Economic Group shows that Michigan's key business taxes are out of step with competing states.
The report specifically cited the Single Business Tax as the only state value-added tax in the United States.
"This is an important first step for restoring a competitive business environment in Michigan," said Jim Kodis, owner of Regal Finishing Inc.
"Elimination of the SBT means businesses won't be taxed on investments within the company and will mean improved benefits, new people and new technology."
Work to replace the Single Business Tax has already begun.
Earlier this summer, a joint House and Senate committee was named to develop a new business tax for Michigan. The committee is scheduled to report back to legislative leaders by Dec. 1, 2006.
"Reforming the SBT is great news for southwest Michigan residents as it will provide more opportunities for our communities to grow and develop," said Shaffer, R-Three Rivers. "Now is the time to take pivotal action and put Michigan back on the map as one of the top places to live and do business."
The ballot initiative started after Gov. Granholm vetoed a Republican-sponsored bill to move forward the repeal of the Single Business Tax in March.
In response to Wednesday's vote, Michigan Republican Party Chairman Saulius 'Saul' Anuzis commented, "With today's vote, the Legislature sent a message to business owners and employees alike that Michigan is focused on improving our economy, attracting new business and creating jobs. By ushering in the end of the job-killing Single Business Tax, the important work to create a pro-growth business climate can begin. Thanks to the hard work of Speaker DeRoche, Majority Leader Sikkema, Brooks Patterson and the hundreds of thousands of concerned Michigan voters who signed these petitions, the Michigan turn-around can begin. The governor says it is irresponsible to kill this jobs killer, but what was really irresponsible was neglecting the advice of economic experts who agree the SBT is costing Michigan jobs. By eliminating the worst business tax in the United States, we can start the long overdue work of getting Michigan back to work."
Calling it needed reform, Dick DeVos praised the leadership of Oakland County Executive L. Brooks Patterson, the work of Michigan residents and the Legislature for enacting the will of the people by repealing the SBT.