Legislative Analysis
Phone: (517) 373-8080
MBT RENAISSANCE ZONE CREDIT http://www.house.mi.gov/hfa
House Bill 5937 as reported from committee Analysis available at
Sponsor: Rep. Cynthia Neeley http://www.legislature.mi.gov
Committee: Tax Policy
Complete to 12-13-24
SUMMARY:
House Bill 5937 would amend the Michigan Business Tax Act to allow for the early
termination of a Michigan Business Tax (MBT) credit for businesses located in renaissance
zones.
Currently, the act allows businesses located in and conducting business activity in a
renaissance zone to claim a nonrefundable credit 1 against their MBT liability. The credit
continues until the tax year in which the renaissance zone designation expires.
Under the bill, a taxpayer and the Michigan Strategic Fund could execute an amendment
to an existing development agreement to terminate the credit before the renaissance zone’s
designation expires.
MCL 208.1433
BACKGROUND:
The Michigan Business Tax was eliminated in 2011 as part of the overhaul that created the
current corporate income tax (CIT). 2 However, certain business that had outstanding
approved or assigned credits (called “legacy credits”) were allowed to continue filing until
the credit is used up. The renaissance zone credit is a legacy credit that continues to be
claimed under agreements with MSF reached before 2011 in renaissance zones where the
designation has not expired.
According to committee testimony, the current statute is preventing at least one taxpayer
from transitioning to the CIT.
FISCAL IMPACT:
House Bill 5937 is permissive in nature and would not impose a direct fiscal impact on the
state or local units of government. That said, if a taxpayer with a renaissance zone MBT
certificated credit and MSF executed an amendment terminating a credit earlier than it
would otherwise expire, general fund revenues would increase. However, the overall fiscal
impact is not expected to be significant. Based on the most recent MEGA and other
1
https://www.michigan.gov/taxes/-/media/Project/Websites/taxes/Forms/2022/2022-MBT/4595_ty2022.pdf
2
https://www.legislature.mi.gov/Bills/Bill?ObjectName=2011-HB-4361
House Fiscal Agency Page 1 of 2
 certificated credit report, it is anticipated renaissance zone MBT certificated credits
claimed will total $3.0 million in FY 2025, $1.5 million in FY 2026, and $0.8 million in
FY 2027, which will be the last year a renaissance zone MBT certificated credit is expected
to be claimed.
The renaissance zone MBT certificated tax credit provides a credit for the portion of the
tax attributable to business activity in an eligible renaissance zone.
POSITIONS:
A representative of Request Foods testified in support of the bill. (12-11-24)
The Michigan Manufacturers Association indicated support for the bill. (12-11-24)
Legislative Analyst: Alex Stegbauer
Fiscal Analyst: Ben Gielczyk
■ This analysis was prepared by nonpartisan House Fiscal Agency staff for use by House members in their
deliberations and does not constitute an official statement of legislative intent.
House Fiscal Agency HB 5937 as reported Page 2 of 2


Statutes affected:
House Introduced Bill: 208.1433