LANSING – Through Monday, Michigan businesses have paid an estimated $470 million so far in quarterly payments under the Michigan Business Tax, which one fiscal official said appears to be on target with revenue estimates.

Meanwhile, the Michigan Chamber of Commerce issued results of a poll done of its members that showed most of those responding saying the MBT was more complicated than the Single Business Tax and that they would pay more under the MBT than they would have under the SBT.

Quarterly payments by businesses for the MBT were due on April 15, but payments are still coming into the state treasury. A final total through April will not be completed until the end of the month, and the $470 million collected includes payments made in February and March.

Jay Wortley of the Senate Fiscal Agency said it was impossible at this point to establish how much of the payment was due to the surcharge implemented on the tax to replace the sales tax on services the Legislature repealed last fall.

Nor was it possible to determine if companies were paying more than initially estimated.

However, the amount of tax collected “is in the ballpark” of what fiscal officials estimated the new tax would collect, he said. The MBT, before the surcharge was added, was designed to be revenue neutral with the SBT.

A number of business groups have said that if the MBT draws in more than anticipated then the Legislature should act to repeal the surcharge.

The poll released by the chamber was done online, and responses were received from slightly less than 10 percent of the chamber’s membership. It was not a randomly conducted survey.

Of those responding, 77 percent said their tax burden would be higher under the MBT than the SBT, and of that the largest percentage, 39 percent said, their tax burden would increase by as much as 50 percent. Another 28 percent said the increase would be as much as 100 percent, while 8 percent said it would be up to 300 percent and 11 percent said it would be more than a 300 percent increase.

Tricia Kinley, director of tax policy and economic development for the Chamber said one member said his tax would increase by more than 1,000 percent.

Of the remaining 23 percent who responded to the question about their tax burden, 10 percent said it would be less than under the SBT, while 13 percent said it would be about the same.

Kinley acknowledged that the tax did shift some of the overall burden but that what is surprising in the findings the group has received is that the shift in tax to out of state businesses that was anticipated does not seem to have occurred.

And a number of companies, 15 percent according to the survey, have indicated they would either move out of the state or cancel any new locations or expansions in Michigan.

Final results of the tax are at least a year off, Kinley said, and some aspects of the tax will be litigated. But the results of the survey should make legislators think about whether the tax is more hurtful than helpful to the state, she said.

Not all business groups have condemned the tax (and the chamber opposed the MBT as it was being approved). But many have called for changes and clarifications of some rules.

But officials with the administration of Governor Jennifer Granholm said they are still receiving indications that most companies are seeing either cuts or no change in their overall tax burden.

This story was provided by Gongwer News Service. To subscribe, click on Gongwer.Com

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