The proposed bill amends the Income Tax Act of 1967 by adding a new section, 678, which introduces a tax credit for qualified taxpayers who produce or blend sustainable aviation fuel in Michigan. Starting from tax years beginning January 1, 2025, these taxpayers can claim a credit of $1.50 per gallon of sustainable aviation fuel sold in the state, provided it is used for aircraft departing from Michigan airports. The credit amount can increase by $0.02 for each additional 1% reduction in life-cycle greenhouse gas emissions above 50%, with a maximum credit limit of $2.00 per gallon.

To qualify for this credit, taxpayers must attach a certificate from the sustainable aviation fuel incentive program to their tax return. If the credit exceeds the taxpayer's tax liability, the excess amount will be refunded. The bill also defines key terms such as "sustainable aviation fuel" and "qualified taxpayer," ensuring clarity in its application. Additionally, the enactment of this bill is contingent upon the passage of Senate Bill No. 236 of the 103rd Legislature.

Statutes affected:
Senate Introduced Bill: 206.1, 206.847