LANSING – While there are parts of the Michigan Business Tax that could be tweaked, a major overhaul of the tax would create uncertainty once again in Michigan’s business climate, which would have a bad effect on economic development, officials representing the Michigan Chamber of Commerce told the House Tax Policy Committee on Wednesday.

Curtis Ruppal, a partner with Plante & Moran, told lawmakers that while grappling with the MBT has distracted businesses from their core function, having uncertainty in the tax system can be just as bad as having bad tax policy.

June Summers-Haas, an attorney with Honigan, Miller, Schwartz and Cohn, said while there is no magic bullet in terms of tax systems, businesses are looking for stability.

To grow a business, a person has to make a five-year plan that includes investment in capital and people, she said, and businesses make those assumptions based on the current tax system.

There was instability when the state was going through the process of changing over from the Single Business Tax to the MBT, Ms. Summers-Haas said, and the Chamber would be concerned the state would look unstable once again, detracting people from considering Michigan as a place for business, if another overhaul moved through the works.

Chair Rep. Kate Ebli (D-Monroe) said there “is an outcry” for some changes in the MBT and questioned how the Legislature could deal with that in the context of keeping a stable tax structure.

Ruppal said some modifications can be made, including looking at the gross receipts and unitary filing provisions, but that it’s best to stay as close to the original intent of the measures as possible.

Summers-Haas said she has yet to see an uncomplicated tax system and while how a business will comply with a state’s tax code is taken into consideration, Mr. Ruppal said how much a business will have to pay in taxes outweighs that matter.

Ruppal said the state has not had enough time under the MBT, which took effect January 2008, to see if it has accomplished what it was meant to accomplish.

Both said that while there are portions of the tax that resemble what other states have, Michigan’s tax structure is still unique.

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