Public Act 328 of 1998 allows a limited number of communities to abate all new personal property taxes of a business in certain geographic areas to spur economic development.
ELIGIBILITY
Abatements include all state and local millage. The State Tax Commission (STC) also must approve the local resolution within 60 days. The State Treasurer, with the written consent of the Michigan Economic Development Corporation, is required to provide advice to the STC as to whether the exemption is necessary to "reduce unemployment, promote economic growth, and increase capital investment."
Eligible projects include manufacturing, mining, research and development, wholesale trade, and office operations. Retail business, hotels, restaurants and casinos are not eligible.
New personal property is property not previously subject to property taxes in any other jurisdiction in Michigan. This includes personal property already in Michigan, but exempt for another reason (for example, property that is receiving a P.A. 198 abatement).
TERMS OF ABATEMENT
The City of Detroit may, by resolution, exempt new personal property of a business in any of the following areas: an industrial development zone (P.A. 198), a renaissance zone, an enterprise zone, a brownfield redevelopment zone, an empowerment zone, a tax increment financing district, a local development financing district, or a downtown development district.
The length of abatement for the new personal property tax is negotiated between the city and the business and formally adopted via a local resolution. The law does not contain a maximum, nor a minimum number of years.
For more information, contact Detroit Economic Growth Corporation at (313) 963-2940. |
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