A bill to amend 1967 PA 281, entitled “Income tax act of 1967,” by amending section 623 (MCL 206.623), as amended by 2021 PA 135.
The proposed legislation seeks to amend the Income Tax Act of 1967 by modifying section 623, which pertains to the corporate income tax. The bill maintains the corporate income tax rate at 6.0% on the corporate income tax base after allocation or apportionment to the state. It introduces several adjustments to the corporate income tax base, including the addition of interest income and dividends from obligations or securities of other states, taxes on net income, and any carryback or carryover of net operating losses. It also allows for the deduction of dividends and royalties from non-U.S. persons and foreign operating entities, and the elimination of income and expenses related to oil, gas, and minerals for qualified taxpayers. A significant new provision requires the addition of expenses related to diversity, equity, and inclusion efforts if they were deducted in arriving at federal taxable income. The bill also defines "mineral" and "qualified taxpayer" as per section 31B and clarifies the meaning of "oil and gas" as those subject to severance tax under 1929 PA 48. Additionally, it allows for the deduction of business losses incurred after December 31, 2011, which can be carried forward for up to nine years.
Co-sponsored by Reps.
Referred to the Committee on Economic Development and Small Business
