A new bill from Lansing, Michigan that would grant exemptions for personal property taxes related to oil and gas wells is raising concern among Michigan residents. Senate Bill 552 would exempt things like piping, machinery, tanks and other equipment used to develop oil and gas wells — plus other drilling costs — from personal property taxes. However, proponents of the bill say it is not a tax break but a legislative remedy to an “administrative error” made last year by the Michigan Treasury Department, and the change would be retroactive to 2012.
According to the Detroit Free Press, leaders of some of Michigan’s poorest counties in the northern Lower Peninsula are alarmed by the bill and say would cost their communities millions in crucial revenue. Montmorency County would be one of the hardest hit counties in the state, and estimates that it would be more than a $3-million total impact on all taxing entities in the county, including schools, the road commission, libraries and the sheriff’s office. Last year, however, Republican Gov. Rick Snyder signed into law a 10-year-phase-out of personal property tax manufacturers pay on industrial equipment, and proponents of the bill say any acceleration of that will only help to produce more jobs and make the climate more tax-friendly for energy exploration and production.
For the full article from the Detroit Free Press, click here.