Government Relations Update
from Jamie Callahan
November 16, 2007

Presidential Primary – Court upholds ruling

The state Court of Appeals upheld the ruling by a Ingham County court that the law establishing Michigan’s January 15, 2008, presidential primary date as unconstitutional.

The law creating the primary date was ruled unconstitutional as the voter information would be available only to the state Democratic and Republican parties.The lawsuit was filed by voter data collection companies who would be denied access to the data.

Last week, the Senate passed legislation which excluded the contested language from the previous law that set the January 15^th date.

Two options remain to salvage the January date.The first is legislative action by the House of Representatives on the recently passed Senate bill, with the other being a ruling by the Michigan Supreme Court overturning the lower courts action.Any appeal to the Supreme Court is expected by the end of day this coming Wednesday.

Services Tax Repeal Bill Moves

Efforts continue to repeal the sales tax on services with just days before the implementation date of December 1^st for the new tax.Last week, the Senate Finance Committee held a lengthy committee hearing on the House passed version.The Senate is slated to take up HB 4508 which repeals the dreaded tax and replaces the revenue from the tax with a surcharge on a business’ MBT (Michigan Business Tax) liability.

At the submission of this update, it is expected that the full Senate will amend the bill on the floor Tuesday, November 20^th, and send revised legislation back to the House for adoption or further amendment when they return after Thanksgiving.Word has it that Senate changes include an increase in the surcharge cap and revisions to the taxation of personal property.

The Chamber continues to meet with parties in support of repealing this burdensome tax before December 1^st. The Chamber and Alliance statement in support of repealing the services tax can be viewed by clicking this link.

A recent report by the Detroit Chamber of Commerce estimated that Michigan companies will likely expend upwards of $900 million in compliance costs to administer the service tax law prior to December 1^st, regardless of whether the tax is repealed.