From Mike Johnston, Executive Vice President of Government Affairs & Workforce Development

I am pleased to report Governor Whitmer signed HB 4378 and HB 4379, which contained our fix for tracking personal property held by remote workers for 2023. This is the third year in a row in which MMA drove the solution to avoid the administrative nightmare of tracking the location and local property tax rate for all equipment in the possession of remote workers, such as laptops, computers and monitors.

The contents of the bill were inserted into another bill amending the General Property Tax Act during the lame duck session as an expedient way to get the bill to the Governor’s desk. We worked closely with Treasury to achieve the solution and appreciate their work and Republican leadership in both the House and the Senate who worked with us to move this critical issue during the last day of legislative session in the 101st Legislature.

Now manufacturers, and all businesses in Michigan can assume all personal property held by remote workers is located at its usual location on “tax day,” December 31 for tax year 2023.

We will continue to work with Treasury to find a more permanent solution. The justification for the bill in each of the three years has been COVID-19, because Treasury believes that is defensible and protects the law from legal challenge. That has been fine to date in order to get agreement with Treasury, but remote work is now embedded in our culture and the proximate justification of COVID-19 is wearing thin. We need a more permanent solution.

Our agenda suggests solutions including eliminating the tax on all office equipment, whether it is remote or not. That approach would alleviate much of the administrative burden for companies without reducing much revenue as the value of office equipment is relatively low. Alternatively, we could remove the COVID reference, because we do not believe it is necessary to defend the policy. The law could just exempt remote personal property.

We will be talking with Treasury about potential permanent solutions in the next legislative session in 2023.

Please feel free to call me directly with any questions at 517-487-8554.

Polk & Associates

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