Budget & Taxes (Revenue)

HB 4184 increases Michigan's excise tax on aviation fuel from 3.10 cents to 4.00 cents per gallon. It directly affects fuel sellers, airlines, and airport operators by changing how this tax revenue is distributed. The bill modifies Section 203 of the Aeronautics Code to require 35% of the tax revenue to fund the state aeronautics fund and 65% to fund qualified airports. It also retains the 1.5-cent refund for airlines operating interstate flights and the exemption for fuel used in leaded racing fuel production.

HB 4187 modifies Michigan's corporate income tax law by adjusting how the tax base is calculated and clarifying revenue distribution. It requires corporations to add back certain taxes and expenses previously deducted for federal purposes (like state taxes or related-party royalties) and eliminates deductions for oil/gas and mineral-related income and expenses. For the 2021-2022 fiscal year, the bill directs $800 million of corporate tax revenue to the Michigan taxpayer rebate fund, while other years’ revenue flows to the general fund. This directly affects corporations operating in Michigan and the state’s budget allocation process.

SB 679 amends Michigan's Lawful Sports Betting Act to change how 10% of certain sports betting revenue is allocated. It directs 90% of payments under Section 7(1)(f) to the state general fund, and 10% to the Michigan Strategic Fund Bureau (as defined in the Michigan Strategic Fund Act). This change is conditional, requiring the separate passage of Senate Bill 631 to take effect. The bill directly affects state revenue distribution from sports betting, updating the allocation mechanism without altering the underlying sports betting law.

HB 5296 modifies Michigan's corporate income tax revenue distribution by removing the allocation to the "strategic outreach and attraction reserve fund" (which was repealed) and redirecting those funds to the "neighborhood roads fund" starting in the 2025-2026 fiscal year. The bill updates Section 695 of the Income Tax Act to reflect this change, specifying that after deposits to the general fund ($1.2 billion) and housing fund ($50 million), funds previously designated for the strategic reserve will instead go to the neighborhood roads fund (starting at $688 million in 2025-2026 and increasing annually through 2028-2029). This affects how corporate tax revenue is allocated to state programs, directly impacting the neighborhood roads fund's funding. The change applies to fiscal years beginning 2025-2026 and beyond, while other allocations (e.g., to housing and revitalization funds) remain unchanged.