|Corporate Income Tax||6.00%|
|Personal Income Tax||4.25%|
|Michigan Property Tax (Industrial Businesses)||Cut by 65%|
|Michigan Property Tax (Commercial Businesses)||Cut by 23%|
|Michigan Sales Tax||6.00%|
Corporate Income Tax - 6.00%
Michigan levies a Single Business Tax (SBT), which is a modified value-added tax (VAT). The rate is 6.00% and there is an additional modified gross receipts tax at a rate of .8%. For 2019, The Tax Foundation ranked Michigan's corporate tax as 11th best in the nation, up from 49th in 2012.
Personal Income Tax - 4.25%
Michigan's personal income tax rate is one of the lowest in the nation - a flat 4.25% tax rate that is scheduled to decline in the next few years.
Michigan Property Taxes - 65% / 23%
While tax rates vary by location, Michigan's property tax system provides automatic exemptions that effectively cut personal property taxes by:
- 65% for industrial businesses
- 23% for commercial businesses
In 2019 the Tax Foundation ranked Michigan’s average property tax 22nd lowest in the nation.
Michigan’s Sales Tax - 6%
The state sales tax is 6% on sales of tangible goods. No local sales taxes are allowed.
Michigan’s flat sales tax of 6% is the 11th best sales tax rate according to the Tax Foundation’s 2019 analysis.
Tax Exempt Purchases
There is no state sales tax charged on:
- Manufacturing machinery and equipment
- Electricity and natural gas used in production
- Pollution control equipment
Inventory Tax - 0%
Michigan has no inventory tax.
Additional property tax abatements available to Michigan businesses include:
- Locally-negotiated abatements, including 100% new real property exemptions available in specified communities
- 50% abatements for up to 12 years on real property for industrial processors and high-tech companies
In 2014 Michigan reformed its personal property taxation:
- Small taxpayer exemption - all industrial and commercial personal property owned by a business is exempt if the combined true cash value is less than $80,000
- Eligible for exemption - Eligible Manufacturing Personal Property (EMPP) used at least 50% of the time in industrial processing or direct integrated support of industrial processing
To learn more about all of our incentive and financing programs or to develop an incentive package tailored to your needs, contact us.