NFIB in Michigan Main Street Agenda for 2019

Date: January 10, 2019

Small Business announces priorities for new Session

NFIB in Michigan Main Street Agenda for 2019

In addition to moving forward with a strong pro-small business agenda, NFIB’s primary mission this session will be to ensure that the economic and policy gains Michigan has made as a state are recognized and defended in the face of potential challenges to that progress. Over the last eight years, tough policy decisions were made that turned our state around and made us a great state to bring a business, grow a business, or start a business. However, the 2018 elections have brought change to the political landscape with the Governor’s office, the Secretary of State, and the Attorney General changing from Republican to Democrat control. The legislature will also see 45 new House members, and 7 new Senate members this session. The Republicans have retained control of the House and Senate, although with a lesser margin of majority. NFIB will be proactive in reminding lawmakers that the failed policies of the past have not improved with age and that there are still small business challenges that must be addressed if we are to remain on a path to prosperity and opportunity for small business and our citizens.

New Mandated Paid Sick Leave and Minimum Wage Hike Efforts Ahead

The last session, NFIB was successful in pulling an extreme Paid Sick Leave employer mandate and a Minimum Wage hike from the statewide election ballot. NFIB was then able to change these bad laws to help small business. However, the same big labor-backed groups that ran the first ballot effort are already preparing for a second ballot run in 2020. With a Democrat Governor now in office, the adopt and amend strategy used last session would be unlikely to succeed. NFIB will use every opportunity available to derail these efforts.

Guard Against Attempts to Create a New Small Business Tax

After more than 36 years of double taxation and punitive tax policy on small business, NFIB was successful in leading the way to repeal the confiscatory Michigan Business Tax (MBT) in 2011 and replace it with a flat rate Corporate Income Tax. Unfortunately, the myth that “small business isn’t paying its fair share” continues to persist as an excuse to expand the Corporate Income Tax to non-corporate C businesses, such as sole proprietors, partnerships, LLC, and Sub S entities – or create a new tax on non-C small businesses. As any small business owner knows, non-C businesses are already paying their “fair share” of business tax under their personal income tax. In fact, in recent years, the amount of revenue to the state from small business taxes passed through on personal income tax payments has exceeded the amount of revenue collected under the Corporate Income Tax when that revenue is netted against the many outstanding MEGA (Michigan Economic Growth Authority) and MBT credits that remain. NFIB will adamantly oppose any effort to change the current Corporate Income Tax or create a new tax to raise taxes on small business.

Oppose State Efforts to Weaken Government Employee Labor Rights

The U.S. Supreme Court ruled that states are forbidden from enforcing laws compelling government employees to provide financial support to government employee unions. In response, legislators in some states are moving to enact new laws with the goal of minimizing the impact of the U.S. Supreme Court decision. NFIB will oppose any effort at the state level to make it more difficult for an employee to exercise their rights to choose labor union membership and support.

Federal Tax Relief Must be Carried Through in State Taxes

NFIB supported legislation, holding Michigan’s small business harmless from any increase in state taxes due to the passage of the Federal Tax Cuts and Jobs Act, was signed into law by Governor Rick Snyder in March of 2018. However, there are some that still seek changes to state tax law that would undo some or all the relief granted to small business by the federal changes. NFIB will oppose any such efforts so that tax relief intended for taxpayers in the federal reforms will continue to flow through to Michigan taxpayers.

Fight Efforts to Impose State Individual Health Insurance Mandates

NFIB supported the Trump administration’s repeal of the federal individual mandate to have health insurance under the Affordable Care Act when it eliminated the penalties for not obtaining healthcare beginning this year (2019). However, Obamacare supporters nationwide have been moving to the state level to encourage states to enact their own individual mandates. NFIB will oppose any attempt to create a Michigan individual health insurance mandate.

Reform Michigan’s Costly No-Fault Auto Insurance System

Last session, a fair and reasonable proposal to reform Michigan’s Costly No-Fault Auto insurance system failed to muster enough votes in the legislature to become law. NFIB will continue to support efforts to address the high auto insurance rates paid by citizens and small business by capping unlimited coverages and supporting improvements that lower cost.

Finding Skilled Workers

Filling jobs with qualified workers are still a major concern for small business as the state continues to see expanding economic growth and opportunity. Last session NFIB supported legislation to provide high school students with increased educational opportunities in skilled trades and other vocational alternatives. These efforts will continue in 2019.

Continue Progress on Cutting Unnecessary Regulations

While much progress has been made in improving our regulatory policy and making state agencies more accountable to the legislature and citizens, the change in the governor’s office will inevitably result in leadership changes in the numerous state agencies that regulate small business. NFIB will continue to support policies that improve the regulatory environment for small business while remaining alert to agency changes that may move in the wrong direction.

Repeal Rule to Require Phone Replacement in 2019

NFIB action was successful in delaying until this year a little known Public Service Commission rule that would have required many small businesses to replace their phone systems by the end of 2016. While the deadline for replacement was extended until the end of this year, the rule still needs to be changed or rescinded entirely to avoid the requirement for replacing perfectly functioning phone systems to meet new and unnecessary requirements.

Keeping the State’s Fiscal House in Order

For years NFIB has led the fight to demand spending reforms and head off attempts to balance the budget on the backs of Michigan small businesses by raising taxes. For the past eight years, Michigan has enjoyed fiscally balanced budgets on time and without gimmicks. But vigilance is needed to be certain that runaway spending and the urge to finance it with new taxes do not make a comeback.

Enough Local Government Over-Reach

Like the game of “Whack-A-Mole”, every time the state passes restrictions on local efforts to raise taxes or duplicate already existing federal and state laws – local governments hatch a new scheme to grow their bureaucracy with burdensome regulations or new taxes and fees. Small business cannot afford to keep up with overlapping local ordinances and rules and NFIB will continue to seek state prohibitions against local governments that use the “local control” mantra as an excuse to micromanage small business.

Avoid the Fiscal Trap of Targeted Tax Incentives

Policy makers are once again falling prey to the siren song of “economic development incentives” via targeted tax handouts to select industries and individual companies. After the miserable failures of these policies in the past, one would think they would know better. The consistent improvement of the overall state tax and business climate is the proven approach for raising the fortunes of all citizens and job providers. Lawmakers must stay this course and avoid the temptation of quick fix targeted tax cut proposals.

Small Business Supports Further Civil Forfeiture Reforms

“Civil asset forfeiture laws” allow the government to seize private property from a citizen or small business owner without ever charging them with a crime. Legislation has already been passed that establishes reporting provisions, raises the standard of proof for seizing assets, and eliminates a requirement for a cash bond before a person could contest the seizure of their property. However, small business owners in Michigan want to see further reform of the state’s civil forfeiture laws by moving to criminal forfeiture and eliminating civil asset forfeiture entirely.

Protect Private Property Rights

NFIB was successful in making marginal progress on the abuse of property rights taking place under current wetlands statutes, however much work remains to be done. Private Property Rights are the bedrock of our free enterprise system and they are always under attack from overzealous government agencies and local government. Vigilance is necessary to head off laws, rules, and actions by government that erode this basic right.

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