Daily Tax Report: State

Michigan Tax Deferrals Approved by Lawmakers Get Governor’s Ax

July 9, 2020, 5:28 PM

Michigan taxpayers hoping for more time to pay a number of state taxes will now have to meet existing deadlines, after Gov. Gretchen Whitmer vetoed five deferral bills out of concern for cash-strapped local governments.

Together the bills would have postponed deadlines for sales, use, individual income, and property tax. Despite overwhelming majority approvals in the House and Senate, the Democratic governor said businesses would have to look for help from state grants and other Michigan Treasury Department programs instead.

“These bills are a commendable effort to provide relief” during the pandemic, Whitmer said Wednesday in one of her veto letters. “However, in Michigan, local governments share in sales, income, and use taxes, and allowing for broad deferment of tax remittances would push many local budgets over the precipice into fiscal crisis.”

  • The state constitution requires revenue sharing payments for cities, villages, and townships based on actual tax collections.
  • Three bills (Senate Bills 935, 936, and 937) would have created installment systems, pushing sales, use, and income taxes owed through August to as far out as November.
  • Two bills (House Bills 5761 and 5810) would have pushed summer 2020 property tax deadlines to March 2021 and created a Treasury Department local-government financing system to advance cash to local governments for the delayed property tax.

To contact the reporter on this story: Alex Ebert in Columbus, Ohio at aebert@bloomberglaw.com

To contact the editors responsible for this story: Jeff Harrington at jharrington@bloombergtax.com; Kathy Larsen at klarsen@bloombergtax.com

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