HOUSE BILL No. 6172 September 22, 1998, Introduced by Rep. Wojno and referred to the Committee on Tax Policy. A bill to amend 1975 PA 228, entitled "Single business tax act," (MCl 208.1 to 208.145) by adding section 39d. THE PEOPLE OF THE STATE OF MICHIGAN ENACT: 1 SEC. 39D. (1) SUBJECT TO SUBSECTION (3), FOR TAX YEARS THAT 2 BEGIN AFTER DECEMBER 31, 1998 AND BEFORE JANUARY 1, 2009, A TAX- 3 PAYER MAY CLAIM A CREDIT OF UP TO 20% OF THE AMOUNT PAID IN THE 4 TAX YEAR TO INSTALL MACHINERY AND EQUIPMENT USED EXCLUSIVELY IN 5 OR ON THE PREMISES OF A MANUFACTURING FACILITY IN THIS STATE THAT 6 IS THE TAXPAYER'S PLACE OF BUSINESS AND THAT IS USED TO MANUFAC- 7 TURE, PROCESS, COMPOUND, OR PRODUCE ITEMS OF TANGIBLE PERSONAL 8 PROPERTY FROM RECYCLABLE MATERIALS FOR SALE OR TO PROCESS POST- 9 CONSUMER WASTE MATERIAL USED EXCLUSIVELY TO PRODUCE FINISHED 10 PRODUCTS. 06964'98 RJA 2 1 (2) TO QUALIFY FOR THE CREDIT ALLOWED UNDER THIS SECTION, 2 THE TAXPAYER SHALL SUBMIT ALL OF THE FOLLOWING WITH THE ANNUAL 3 RETURN REQUIRED BY THIS ACT ON WHICH THE CREDIT IS CLAIMED: 4 (A) CERTIFICATION FROM THE DEPARTMENT OF ENVIRONMENTAL QUAL- 5 ITY THAT THE MACHINERY AND EQUIPMENT INSTALLED ARE INTEGRAL TO 6 THE RECYCLING PROCESS. 7 (B) EITHER OF THE FOLLOWING: 8 (i) PURCHASE RECEIPTS, INVOICES, AND OTHER DOCUMENTATION OF 9 THE COST PAID FOR THE INSTALLATION OF THE MACHINERY OR 10 EQUIPMENT. 11 (ii) OTHER AUDITABLE DOCUMENTATION THAT INCLUDES DETAILS OF 12 THE COST PAID FOR THE INSTALLATION OF THE MACHINERY OR 13 EQUIPMENT. 14 (3) THE TOTAL OF THE AMOUNTS CLAIMED AS CREDITS UNDER THIS 15 SECTION AND SECTION 39C FOR ANY TAX YEAR SHALL NOT EXCEED 20% OF 16 THE TOTAL AMOUNT PAID BY THE TAXPAYER IN THE TAX YEAR TO PURCHASE 17 AND INSTALL MACHINERY AND EQUIPMENT DESCRIBED IN SUBSECTION (1). 18 (4) THE TOTAL AMOUNT ALLOWABLE AS CREDITS UNDER THIS SECTION 19 AND SECTION 39C FOR ANY TAX YEAR SHALL NOT EXCEED 20% OF THE TAX 20 LIABILITY FOR THAT YEAR AS DETERMINED WITHOUT REGARD TO THIS SEC- 21 TION AND SECTION 39C. 22 (5) IF THE TOTAL CREDITS ALLOWED UNDER THIS SECTION AND 23 SECTION 39C FOR THE TAX YEAR AND ANY UNUSED CARRYFORWARD OF THE 24 CREDITS ALLOWED BY THIS SECTION AND SECTION 39C EXCEED 20% OF THE 25 CLAIMANT'S TAX LIABILITY FOR THE TAX YEAR, THAT PORTION THAT 26 EXCEEDS 20% OF THE TAX LIABILITY FOR THE TAX YEAR SHALL NOT BE 27 REFUNDED BUT MAY BE CARRIED FORWARD TO OFFSET TAX LIABILITY IN 06964'98 3 1 SUBSEQUENT TAX YEARS FOR 10 YEARS OR UNTIL USED UP, WHICHEVER 2 OCCURS FIRST. 3 (6) FOR PURPOSES OF THIS SECTION, A TAXPAYER THAT HAS A 52- 4 OR 53-WEEK TAX YEAR BEGINNING NOT MORE THAN 7 DAYS BEFORE 5 DECEMBER 31 OF ANY YEAR IS CONSIDERED TO HAVE A TAX YEAR BEGIN- 6 NING AFTER DECEMBER 31 OF THAT YEAR. 7 (7) AS USED IN THIS SECTION: 8 (A) "MANUFACTURING FACILITY" MEANS BUILDINGS AND STRUCTURES 9 THE PRIMARY PURPOSE OF WHICH IS EITHER OF THE FOLLOWING: 10 (i) THE MANUFACTURE OF GOODS OR MATERIALS OR THE PROCESSING 11 OF GOODS AND MATERIALS BY PHYSICAL OR CHEMICAL CHANGE. 12 (ii) THE PROVISION OF RESEARCH AND DEVELOPMENT LABORATORIES 13 OF COMPANIES WHETHER OR NOT THE COMPANY MANUFACTURES THE PRODUCTS 14 DEVELOPED FROM THEIR RESEARCH ACTIVITIES. 15 (B) "RECYCLABLE MATERIALS" MEANS ANY PRODUCT GENERATED BY A 16 TAXPAYER THAT HAS SERVED ITS INTENDED END USE AND THAT HAS BEEN 17 SEPARATED FROM SOLID WASTE FOR THE PURPOSE OF COLLECTION, MARKET- 18 ING, AND DISPOSITION AND THAT DOES NOT INCLUDE DEMOLITION WASTE 19 OR MORE THAN 15% SECONDARY WASTE MATERIAL OR DEMOLITION WASTE. 20 (C) "SECONDARY WASTE MATERIAL" MEANS WASTE MATERIAL GENER- 21 ATED AFTER THE COMPLETION OF A MANUFACTURING PROCESS. 06964'98 Final page. RJA