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Posted on Wed, Jan 6, 2010 : 9:40 a.m.

Gubernatorial candidate Rick Snyder calls for elimination of Michigan Business Tax

By Nathan Bomey

Ann Arbor venture capitalist Rick Snyder, a Republican gubernatorial candidate and former president of computer maker Gateway Inc., today called for the elimination of the Michigan Business Tax.

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Michigan gubernatorial candidate and Ann Arbor venture capitalist Rick Snyder

Snyder unveiled a plan that calls for the state to replace the controversial MBT with a single, flat-rate corporate income tax of 6 percent. The Grand Rapids Press reported:

"Eliminating the MBT is one of the most important first steps that can be taken to put Michigan on the path to economic prosperity and restoring our state's reputation," he said. His plan, covered in a seven-page report, would raise an estimated $700 million, less than the $2.2 billion the Michigan Business Tax is estimated to generate for the 2009-10 fiscal year. With falling tax receipts failing to keep pace with state budget spending, reforming Michigan's tax code is a likely to be at the forefront of the gubernatorial campaign this year. Snyder's campaign said the difference "likely amounts to a $1.5 billion tax cut on Michigan job creators."

Snyder's top competitors for the Republican nomination are Attorney General Mike Cox, Oakland County Sheriff Michael Bouchard and U.S. Rep. Peter Hoekstra. All four candidates have pressed for business tax reform.

Snyder's announcement comes one day after prominent conservative David Brandon, long rumored as a potential gubernatorial candidate, opted to accept the University of Michigan's athletic director position. It also comes after Lt. Gov. John Cherry, widely considered the favorite to win the Democratic nomination, dropped out of the race.

Read more about Snyder's proposal from the Grand Rapids Press and the Associated Press.

Contact’s Nathan Bomey at (734) 623-2587 or You can also follow him on Twitter.


David Briegel

Thu, Jan 7, 2010 : 10:34 a.m.

He answered the question. He is going to balance the budget on the backs of real working people with families etc. He is going to break the promise and destroy their future! He's a good Republican! Good post MikeAA


Wed, Jan 6, 2010 : 7:34 p.m.

Wasn't the MBT introduced because businesses HATED the SBT? How about we not tax them at all, eliminate the minimum wage, unemployment compensation, and environmental laws? I'll bet we could REALLY grow jobs, oh wait, that's China!


Wed, Jan 6, 2010 : 5:05 p.m.

Every election cycle we hear the same thing, rescind the MBT tax. This is great political theatrics, but we never hear where the money is going to come from to replace it. The idea always dies away until the next election cycle. The tax is there for a reason and serving a purpose today. I want Michigan to become more competitive for locating businesses here, but I never see any kind of proof or facts about how detrimental the MBT is and how other states raise the same money through other tax systems. I would prefer to hear how we are going to raise the money to replace it and where this money is going to come from. I would like to see comparison of how the other states collect taxes. What is the best state and tax system for business and why?


Wed, Jan 6, 2010 : 3:30 p.m.

I read it as $700,000,000 million short fall and not $ 1.5 billion. He references a $1.5 billion tax bre.ak to businesses, not short fall. I think he is referencing the money back in the business owners pocket and the effect that wil have on the business owner to keep more money. One thing that really needs to be looked at are the fees charged by the Corporations Division of the Department of Labor and Economic Growth. They should be raised. Paying a one time or annual fee for a filing to engage in business in the state is not as hard to swallow as a big tax on your efforts and rewards afterwards. Plus, Michigan's fees are a lot lower than the fees in other states. With respect to phasing out pensions, pass a law similar to Florida that protects annuities from creditors and judgments. Then you can pass more legislation phasing out, and paying out, the exisitng amount of pensions vested in the form of annuities. Consideration would have to made for the partial investment, but at the end you work your way away from it. The plus is people will probably consider sticking around Michigan at retirement age, and also consider retiring to Michiigan at retirement age, because of the annuity protection. I mean look, it got OJ to leave LA for Florida.


Wed, Jan 6, 2010 : 2:19 p.m.

"When are Americans finally going to say that pensions, and other forms of promised compensation, which determines a person's career choices are sacrosanct and hands off?" - MikeAA. I'd like to ask the following: When are Americans going to accept personal accountability for their future instead of assuming their employer or a government entitlement program will provide for them indefinitely? Pensions are a thing of the past and have been for most private sector workers for over a decade. This is a difficult change to accept, but accept it we must. Why would anyone want to place their future in the hands of a company or gov't managed pension fund, knowing that in times of economic contractions those funds are going to be called into question? Let's accept responsibility for our own futures, learn to live within our means, and develop diversified savings plans. Pensions were to good to be true in an ever-changing world. I am excited to hear specifics of Rick's plans to turn Michigan around and hope to hear more from the other candidates sooner rather than later.


Wed, Jan 6, 2010 : 1:19 p.m.

What a ridiculous proposal. Of course he supports eliminating the Michigan Business Tax...he's a buisness owner. His vested interest in this lies not with the people of Michigan, but with his own corporate ambitions.

Bob Martel

Wed, Jan 6, 2010 : 12:27 p.m.

I would support doing away with the MBT so long as the lost revenues are fully made up by legitimate cost reductions and/or increases in other (more rational) taxes. We cannot afford to just push the deficit down the road. As far as the loss of benefits to State employees is concerned, I am sympathetic to the "change in the deal" that would result as mentioned by some of the previous commentators. However, times have changed since the promises were made and this State no longer has the resources to keep those promises. Unfortunately, this is not unique to the public sector as most private sector employees have also had the game changed in the middle of their careers. This is not fun, and no one should advocate such actions capriciously, but it's simply the facts as they exist in Michigan today and for the foreseeable future.


Wed, Jan 6, 2010 : 12:09 p.m.

When are Americans finally going to say that pensions, and other forms of promised compensation, which determines a person's career choices are sacrosanct and hands off? How would you like it if you decided to work somewhere for 25 years and did so in the name of a retirement benefit, which caused you to not pursue other opportunities, all to have the game changed at the 11th hour? In the end, if we treat public employees like low grade indentured servants whose compensation is constantly negotiable, we'll have even greater incompetence in government than what we currently observe (yes, it is possible). They're in the same labor market as everybody else, where the law of 'you get what you pay for' remains inviolable.

Alan Benard

Wed, Jan 6, 2010 : 11:32 a.m.

In other words, Mr. Snyder - like the car companies, and so many other companies - wishes to conveniently forget the deal the state government made with employees to provide long-term security in the form of deferred compensation -- a defined-benefit pension. Would you do business with someone who wants to change the price after you deliver the goods?


Wed, Jan 6, 2010 : 11:15 a.m.

My guess is he's worked through the math or solution for balancing the budget given his background. What's the BIG benefit here is how much time businesses will save by not having the cumbersome MBT system. The existing system is an abomination.


Wed, Jan 6, 2010 : 11:08 a.m.

After reading his biopic/credentials on his campaign site, he seems to be an intelligent, highly-educated, successful man...I would entertain the thought of voting for him if I knew more about his personal fervor (or perhaps lack-thereof) of GOP social issues. The last thing I'd want is a GOV that will kowtow to the far-righties we have in the legislature etc. I love Michigan, but don't want to live in a religious police-state. I agree with him on 2nd amendment and tax policy, but I need more info as I won't vote for a "Palin".

Nathan Bomey

Wed, Jan 6, 2010 : 10:17 a.m.

Bob, according to the Grand Rapids Press, Snyder "would seek to stem the shortfall by addressing rising costs in public employee health and retirement plans." According the AP, "He says the state could make up the difference in part by reducing what it spends on public workers' wages and benefits. He also would scale back about $30 billion in special tax breaks and exemptions."

Bob Martel

Wed, Jan 6, 2010 : 10:09 a.m.

I agree that the MBT is an abomination, but what does Mr. Snyder plan to do about the $1.5 billion in lost revenue?