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Elimination of the Michigan Business Tax - $1.67 Billion Tax Cut After more than 36 years of double taxation and punitive tax policy on small business, NFIB/Michigan was successful in leading the way to repeal the confiscatory Michigan Business Tax (MBT) and replace it with a flat rate Corporate Income Tax. As a result, businesses that are not "C" type corporations will continue to pay their business tax through the state income tax and will no longer have any tax liability under the old MBT. This will end the "double taxation" that discourages many small businesses from expanding and growing jobs and represents a net tax cut of $1.67 billion.
Michigan Becomes a Right to Work State
Years of effort by NFIB in supporting Right to Work finally paid off as landmark legislation was pushed through in the last weeks of the 2012 Lame Duck session that makes Michigan the 24th Right to Work state. The final vote came after a day of demonstrations and violence by labor unions and activists opposed to the legislation. This will be the most important economic reform in decades and it will make Michigan immediately more competitive regionally, nationally and internationally.
Personal Property Tax Reform
In the wee hours of the morning on the last day of the 2012 Lame Duck session, legislation implementing NFIB supported reforms to the Personal Property Tax were passed. The legislation will phase out the industrial portion of the tax over six years beginning in 2016 with all industrial personal property purchased after 2011 becoming completely exempt in fiscal year 2015-16. Starting in 2014, small business owners with commercial personal property less than $40,000 SEV (State Equalized Value) will be exempt from paying any personal property tax.
Defeating Big Labor's Ballot Proposals
In a desperate bid to return to the glory days of union dominance, big labor pushed three ballot proposals in 2012 that would have turned the clock back on labor policy reforms hard fought by NFIB. When the dust settled they barely eked out a win on one out of three and that victory will be short lived as NFIB pushes for legislation to undo the damage.
Forced Union Scams Ended
NFIB action has resulted in an end to two labor union dues money skimming operations concocted by the previous Granholm administration and organized labor. The home based daycare scam was ended in 2011 by Governor Snyder and a similar scam involving home health care workers will end in February of 2013 following the failure of the union’s ballot proposal to legitimize the scheme. If not defeated, this practice of forcing small businesses and the self employed to join a union because they accept state payments for services would force others to join unions such as stores that accept Bridge Cards, doctors that accept Medicaid and anyone that bids on and wins a state contract.
MIOSHA Ergonomics Rules Killed
For almost ten years, NFIB took the lead on slowing down the rule making process to keep MIOSHA (Michigan Occupational Safety and Health Administration) at bay on a proposed “Michigan only” ergonomics rule that would heap new paperwork and training requirements on small business. In January of 2011 those efforts were rewarded when Governor Rick Snyder announced that the effort to draft the rule was dead and he signed legislation halting the process. Had NFIB not led this fight, small employers in Michigan would have had yet another bureaucratic requirement to contend with.
Worthless MIOSHA Commissions Terminated
NFIB support and action resulted in the passage of legislation that eliminated three worthless MIOSHA commissions that were nothing more than proxies for big labor unions seeking more regulations on small business. The legislation eliminated the Occupational Health Standards Commission, the General Industry Safety Standards Commission and the Construction Safety Standards Commission. These commissions were responsible for the proposed ergonomics rule fiasco and other unnecessary rules being pushed by big labor.
Reining in Government Employee Pay and Benefits
NFIB strongly supported Governor Rick Snyder's budget and legislative proposals that brought important reforms in government employee wages and benefits. As a result, legislation is now in place that requires government employees to participate in the cost of health insurance benefits that are paid for by Michigan taxpayers. NFIB will be working to find more ways to bring government employee costs in line with those in the private sector.
Unemployment Insurance Changes Save Millions
NFIB/Michigan was successful in adding an amendment to a House Bill that will cut the current 26 weeks of state Unemployment Insurance benefits to 20. The move will save employers almost a billion dollars over the next three years. Follow up legislation passed in the last week of the 2011 session will implement strong fraud and waste measures in the Unemployment Insurance system and replace severe federal penalties for borrowed funds with a more manageable bond assessment.
Workers’ Compensation Reforms Lower Costs
Legislation passed with NFIB support will make important reforms to our workers’ compensation act. The changes will clarify and update many parts of the current workers compensation law that have become outdated or have been eroded by the efforts of the trial bar. By bringing stability and predictability to the law, the costs of workers’ compensation coverage paid for by Michigan job providers will also be stabilized and brought under control.
Ending Union Favoritism in Construction Bidding After years of NFIB effort, legislation has been passed that will prohibit union-only “Project Labor Agreements” (PLAs). This will end a practice by many local governments that shut out small business, non-union, companies from the bidding process. When non-union contractors – who make up the vast majority of construction firms – are prohibited from bidding on projects funded with public dollars, taxpayers are forced to pay inflated costs due to the limitations on open bidding. This unwise stewardship of tax dollars entrusted to government by the citizens will now be prohibited.
Union Prevailing Wage "Blacklist" Eliminated
With NFIB support, a union influenced Prevailing Wage “blacklist” on the internet hosted by the state of Michigan was eliminated. The list, made available on the internet by the state of Michigan, was nothing more than a non-union contractor witch hunt that publicized even the most minor violations – including honest accounting mistakes - as far back as 1998, well after disputes were settled. Labor unions encouraged local governments and the state to use the list to exclude non-union contractors from bidding. Often, union contractors with similar violations were not found on the list.
A Balanced Budget With No Tax Hike
Michigan finally has a structurally sound, balanced budget agreement that is based on solid financial principles and avoids tax hikes on small business. With this significant accomplishment, brought about with strong involvement by NFIB, Michigan citizens will know that the 2013 and the 2014 fiscal year budgets are structurally balanced. As a state, we can begin moving from the “Old Michigan” to the “New Michigan.”
Small Truck USDOT Number Requirement Repealed
In a classic example of regulatory ‘mission creep’ a requirement intended for big trucks ended up being slapped on small business and small vehicles. NFIB action resulted in the repeal of Michigan’s requirement that a commercial vehicle over 10,000 lbs have USDOT (U.S. Department of Transportation) identification numbers and comply with costly regulation. The law now only applies to vehicles over 26,000 lbs. as the law originally intended.
Services Tax Proposal Blocked
A plan by the previous Granholm administration and some big business representatives for a sales tax on services was successfully blocked by NFIB. The proposal called for lowering the sales tax rate to 5.5 percent and expanding the tax to consumer services. Most of the new revenue would have ended up in the School Aid and General Fund to prop up bloated state employee benefits and pay. NFIB action kept the plan from moving forward and we continue to be vigilant as new services tax proposals are floated by the tax and spend crowd.
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