Michigan’s reinvention continues to gain momentum with an update from the Tax Foundation that improves the state’s corporate tax ranking in the State Business Tax Climate Index from 49th to 7th in the nation, Gov. Rick Snyder has announced.
The Tax Foundation, a nonpartisan tax research group based in Washington, D.C., also upgraded Michigan’s overall tax rank from 18th to 12th.
“Once again, the nation is taking notice of the bold reforms that are driving Michigan forward,” Snyder said. “The bold reforms we made in 2011 dramatically improved the state’s tax ranking and are further proof that the best way to boost Michigan’s economy and improve the quality of life for all is to create an environment that encourages job growth and innovation. We’re committed to ensuring that Michigan families have jobs and that our children have bright futures in this state. These reforms are the foundation for that success.”
In 2011, Snyder and his legislative partners spurred the state’s recovery by eliminating the job-killing Michigan Business Tax, which stifled job growth and hampered investment. It was replaced with a flat 6 percent Corporate Income Tax, which took effect Jan. 1. The tax is the most competitive in the Midwest and among the best in the nation.
“Confidence that Michigan is on the right track helped to create 80,000 private-sector jobs in the state last year,” said Michigan Economic Development Corporation President and CEO Michael A. Finney. “Our improved ranking only solidifies what business sees as renewed opportunities in Michigan. Our improved business climate is encouraging new investment that puts families to work and fuels Michigan’s prosperity.”
The Index is based on state laws that were implemented by July 1, 2011. Because Michigan’s changes did not take effect until this year, the Tax Foundation thought it was important to highlight the state’s impressive improvement. Michigan’s actual rankings in the upcoming Index will depend on changes made by other states in the meantime.
The Tax Foundation’s State Business Tax Climate Index measures which states have the most neutral, simple and business-friendly tax structures. In its evaluation, the Tax Foundation said it is clear that these reforms are a “major improvement for Michigan’s business tax system.”
Read the entire article on the Tax Foundation’s policy blog.