Michigan Senate Bill SB0233

Michigan 2023-2024 Regular Session

• Introduced: 3/22/23
• Refer: 3/22/23
• Refer: 4/26/23

Caption

Use tax: exemptions; industrial processing exemption; clarify. Amends sec. 4o of 1937 PA 94 (MCL 205.94o). TIE BAR WITH: SB 0232'23

Impact

The proposed amendments would provide detailed definitions and criteria for what constitutes industrial processing. This includes an extensive list of activities such as production, assembly, research, and recycling, which can potentially benefit businesses engaged in these operations. The legislation seeks to reduce administrative ambiguity and streamline compliance for manufacturers and industrial processors in Michigan. Enhanced clarity might also incentivize investment in industrial processes that contribute to the state's economy.

Summary

Senate Bill No. 233 aims to amend section 4o of the 'Use Tax Act' first enacted in 1937. The bill clarifies the exemptions from the use tax for property sold to industrial processors and outlines specific types of tangible personal property that can be exempt. This legislation is particularly targeted at items that are utilized directly in industrial processing. The aim is to provide clearer guidance on what qualifies for these exemptions, thereby encouraging industrial growth and development in Michigan.

Contention

There are notable discussions surrounding the adequacy of exemptions granted under this bill. Supporters argue that these clarifications are necessary to avoid litigation and discrepancies regarding tax responsibilities. Critics, however, may argue that any expansions of exemptions could lead to reduced revenues for the state and potentially skew economic responsibilities unfairly towards larger corporations. The association between this bill and Senate Bill No. 232, which is tied to the amendments, could spark further debate on interrelated tax policies affecting industrial sectors.