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2012 Senate Bill 1069: Cut tax imposed on business tools and equipment

Public Act 401 of 2012

  1. Introduced by Sen. Dave Hildenbrand (R) on April 17, 2012, to eliminate (starting 2015) the so-called “personal property tax” on tools and equipment used by manufacturing firms (including things like assembly lines), starting with new equipment acquired from the start of 2012. The bill would also phase out the tax on existing equipment over a seven-year period beginning in 2015. This is part of a package comprised of Senate Bills 1065 to 1072, which uses tax revenue that now pays for previously-granted “corporate welfare” tax breaks and cash subsidies to reimburse local governments for the proposed reduction in revenue. The “personal property tax” currently costs businesses statewide around $1.2 billion annually, which would eventually be reduced by around $470 million.
    • Referred to the Senate Finance Committee on April 17, 2012.
      • Reported in the Senate on May 2, 2012, with the recommendation that the bill pass.
    • Amendment offered by Sen. Dave Hildenbrand (R) on May 10, 2012, to suspend the proposed personal property tax cuts on business tools and equipment if the legislature fails to appropriate the reimbursements of foregone revenue to local governments proposed by Senate Bill 1072. The amendment passed by voice vote in the Senate on May 10, 2012.
    • Amendment offered by Sen. Gretchen Whitmer (D) on May 10, 2012, to tie-bar the bill to Senate Bill 117, meaning this bill cannot become law unless that one does also. SB 117 would require candidates for state offices and high-paid local offices to file personal financial disclosure statements. The amendment failed 13 to 24 in the Senate on May 10, 2012.
      Who Voted "Yes" and Who Voted "No"

    • Amendment offered by Sen. Hoon-Yung Hopgood (D) on May 10, 2012, to tie-bar the bill to Senate Bills 1016 and 1017, meaning this bill cannot become law unless those ones do also. Those bills would create a system for rating selective “corporate welfare” type tax breaks and subsidies given to certain firms or industries. The amendment failed 12 to 25 in the Senate on May 10, 2012.
      Who Voted "Yes" and Who Voted "No"

  2. Passed 23 to 14 in the Senate on May 10, 2012.
    Who Voted "Yes" and Who Voted "No"

  3. Received in the House on May 10, 2012.
    • Referred to the House Tax Policy Committee on May 10, 2012.
      • Reported in the House on December 5, 2012, with the recommendation that the substitute (H-1) be adopted and that the bill then pass.
    • Substitute offered in the House on December 13, 2012. The substitute passed by voice vote in the House on December 13, 2012.
    • Amendment offered by Rep. Phil Cavanagh (D) on December 13, 2012, to reimpose the tax imposed on business tools and equipment if the legislature fails to appropriate replacement revenue to local governments. The amendment failed by voice vote in the House on December 13, 2012.
    • Amendment offered by Rep. Vicki Barnett (D) on December 13, 2012, to delay the proposed phase-out of this tax. The amendment failed by voice vote in the House on December 13, 2012.
    • Amendment offered by Rep. Jeff Farrington (R) on December 13, 2012, to establish a new date on which the bill will go into effect. The amendment passed by voice vote in the House on December 13, 2012.
    • Amendment offered by Rep. Jud Gilbert (R) on December 13, 2012, to classify some specific types of business activity as "industrial," which means larger tax cuts under this legislative package. The amendment passed by voice vote in the House on December 13, 2012.
    • Amendment offered by Rep. Jeff Farrington (R) on December 13, 2012, to revise a detail of how the tax cut (which comes in the form of a tax "credit") will be claimed by businesses. The amendment passed by voice vote in the House on December 13, 2012.
    • Amendment offered by Rep. Jeff Farrington (R) on December 13, 2012, to make the bill's provisions contingent on approval by voters of a measure earmarking a portion to the state use tax to replacing local government revenue foregone by cutting the property tax on business tools and equipment. The amendment passed by voice vote in the House on December 13, 2012.
  4. Passed 57 to 51 in the House on December 13, 2012, to gradually eliminate the so-called “personal property tax” levied on tools and equipment used by manufacturing firms (including things like assembly lines. Another bill in this package would reduce (but not eliminate) the amount of this tax extracted from commercial businesses, and others would reimburse the revenue that local governments and school districts now collect from it. This property tax on business tools and equipment currently costs Michigan employers around $1.2 billion annually, which over time would fall to about half that amount.
    Who Voted "Yes" and Who Voted "No"

  5. Received in the Senate on December 14, 2012.
  6. Passed 25 to 13 in the Senate on December 14, 2012, to concur with the House-passed version of the bill.
    Who Voted "Yes" and Who Voted "No"

  7. Signed by Gov. Rick Snyder on December 20, 2012.

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