Michigan House Bill HB6018

Michigan 2023-2024 Regular Session

• Introduced: 9/26/24
• Refer: 9/26/24

Caption

Individual income tax: credit; credit for sales and use tax paid for textbooks purchased by eligible students; provide for. Amends 1967 PA 281 (MCL 206.1 - 206.847) by adding sec. 280.

Impact

Upon enactment, HB 6018 will introduce significant changes to the existing income tax framework in Michigan as outlined in the Income Tax Act of 1967. The inclusion of a tax credit for textbook purchases may encourage more individuals to seek higher education by reducing the financial burden of essential educational materials. The bill also mandates that taxpayers provide receipts and evidence of eligibility to claim the credit, which could streamline tax administration while ensuring authenticity in the claims made under the new law.

Summary

House Bill 6018 proposes a tax credit for individuals paying sales or use tax on textbooks purchased for eligible students. This bill aims to provide financial relief to students by allowing them to claim a credit equivalent to the sales tax paid on textbooks for the tax years starting from January 1, 2024. The provisions define 'eligible students' as those who have been awarded a federal Pell grant and are enrolled in accredited educational institutions in Michigan, which may include various forms of educational establishments such as community colleges, junior colleges, and vocational schools.

Contention

While the bill garners support as a means to facilitate education, there may be some contention regarding its fiscal implications. Critics could argue about the potential loss of tax revenue for the state, which might arise from the broad granting of this credit, particularly if a substantial number of students take advantage of it. Additionally, the requirement for eligibility linked to federal Pell grants may be seen as restrictive, potentially leaving out many deserving students who do not qualify for federal assistance but still require support for educational expenses.