Michigan Votes Forum

Introduced in the House on December 2, 2003, to exempt for five years a "qualified start-up business" from any single business tax (SBT) liability in a year in which it does not make a profit. (Note: The SBT is a tax on the value added by a firm in producing a product, which means that a firm may owe SBT tax even though it makes no profit.) A "qualified start-up business" is defined as a firm that has fewer than 25 full-time equivalent employees, has annual sales of less than $1 million, has research and development expenses that make up at least 15-percent of its annual expenses, and is not publicly traded. This does not necessarily apply only to new firms, and the five year exemption is not necessarily the firm's first five years of operation

The vote was 103 in favor, 4 opposed and 2 not voting

(House Roll Call 277 at House Journal 34)

Click here to view bill details.

Rep. Hopgood, having reserved the right to explain his protest against the passage of the bill, made the following statement: "Mr. Speaker and members of the House: I voted no on the package of bills deemed to assist 'start-up' businesses (HB 5331, 5335, 5341-43, 5345; SB 863, 865, 867, 872, 875) because they will actually amount to very little in terms of tax relief to business but will cost the state treasury up to $15 million at a time when, if revenues are not increased, significant reductions will have to take place in programs to seniors, education and health care. The bills also have the potential of undermining existing economic development programs and incentives and pitting local units against each other in the race to land businesses. Local units will again be forced to choose."

Rep. Meisner, having reserved the right to explain his nay vote, made the following statement: "Mr. Speaker and members of the House: I continue in opposition to this legislation on the basis that it, like so many others, will make worse the instability of our budget situation by piling tax exemptions on top of the billions in breaks we give away each year without any notice given to the effectiveness of previous efforts."