The SBAM Advocacy Team broke down the recently introduced House Economic Development package in Monday’s Small Business Briefing. Click Here to Watch
Article courtesy MIRS News for SBAM’s Lansing Watchdog newsletter
A business creating new jobs could receive an annual payroll credit of up to 50 percent of their income tax withholding until 2036 under the Real Jobs Tax Credit announced Thursday.
Speaker Matt Hall (R-Richland Township) said the economic development move is part of a deal he made with Gov. Gretchen Whitmer and Senate Majority Leader Winnie Brinks (D-Grand Rapids) after cutting the Strategic Outreach and Attraction Reserve (SOAR) fund and cutting other business attraction funds.
For a business to qualify for the tax credit, the new jobs they create would have to be permanent and full-time positions that pay at least 150 percent of the median regional wage.
Rep. Mike Hoadley (R-Au Gres), sponsor of HB 5293, and chair of the House Economic Development Committee, said the bills create high-paying, middle-class jobs without performing “corporate welfare” or giving corporations taxpayer money.
Rep. Mark Tisdel (R-Rochester), sponsor of HB 5292, and chair of the House Finance Committee, specified that these tax credits could apply to both large corporations and small businesses that operate in Michigan.
The limit is $50 million spent each year until 2036 on the tax credit. It’s split up by $10 million for small businesses under 100 employees, $15 million for businesses with 100–999 employees, and $25 million for large businesses with more than 1,000 employees.
HB 5294, HB 5295, HB 5296 and HB 5297 introduced by Reps. Matt Maddock (R-Milford), Ann Bollin (R-Brighton), Josh Schriver (R-Oxford) and Sarah Lightner (R-Springport), respectively, would repeal SOAR as part of this new plan.
“It’s a new opportunity for us to reset,” Tisdel said at a press conference on Thursday.
“If these companies are really committed to the success of Michigan, they’ll take the deal,” Hall said.
Any business can apply regardless of their classification, Hoadley said.
Hall said this will be the focus for the next few weeks, and once the Legislature comes back from the hunting break and Thanksgiving holiday, he hopes to have bills signed into law in December.
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