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In case you missed it, Gov. Whitmer vetoed a handful of bills last week which would have provided various forms of tax relief to people and businesses still working to recover from the coronavirus pandemic.

HB 5761 and HB 5810 would have allowed taxpayers that have been adversely affected economically by the coronavirus pandemic to defer summer 2020 property tax payments without penalties and interest until Feb. 28, 2021. To offset the temporary loss of revenue, each county could apply for an interest-free loan from the Department of Treasury. The bills were approved with unanimous support in the State House and received strong bipartisan support in the State Senate. The governor opted not to sign them into law, citing “fatal constitutional flaws” in her veto letter.

SB 935, SB 936 and SB 937 would have allowed taxpayers whose businesses have been negatively impacted as a result of a COVID-19 executive order to defer their sales, use and income tax payments until Nov. 20, 2020. This would have also included accelerated filers, whom relief programs up to this point had excluded. These bills, like the House Bills above, moved through the process with overwhelming bipartisan support. The governor again opted not to sign, citing ‘increased stress on local budgets’ in her veto letter.

Local governments already know a large number of taxpayers will be unable to pay their property taxes this year. This legislation, while imperfect, would have at least provided a mechanism to alleviate some of the serious cash flow problems business owners are experiencing. Furthermore, our partners at the Michigan Chamber were already working to correct and address any technical issues with the bills in follow-up legislation.

According to the veto letters, one of the reasons these laws weren’t “necessary” was because the state already “led the way by getting unemployment benefits out to recipients.” That is true. To date, the state has paid out a record $14 billion in benefits to more than 2.1 million people. While crucial to help employees during a difficult time, we regret to report struggling employers will soon be left with the bill.

State law requires that should Michigan’s unemployment compensation fund balance fall below $2.5 billion by June 30, the taxation rate for unemployment contributions would increase from a cap of $9,000 for employers to $9,500 in the next calendar year.

It did — triggering a tax increase for all Michigan employers, regardless of their size.

Businesses should not be asked to shoulder yet another consequence of state decision making while the state simultaneously vetoes legislation that would actually help them in their fight for survival. If that’s Michigan’s economic recovery strategy, it’s a recipe for disaster.

Michigan’s comeback must instead center around supporting small businesses through meaningful tax reform and other targeted relief. If we don’t correct course quickly, we will soon see another round of businesses begin to close their doors.