Business Costs

Saginaw Future’s experience with and knowledge of business taxes and incentives allow us to help companies identify and understand the opportunities available through the State of Michigan, counties and individual municipalities in our county.  Click here to learn more about the State of Michigan’s competitive tax system.

Saginaw Future works with state and local partners to tailor high-impact incentive packages that include financing, local tax incentives, and workforce development.  We offer an affordable environment to do business in:

  • A state business tax climate ranked 13th in the U.S.
  • Right-to-work legislation passed in 2012
  • Corporate Tax Rate ranked as 10th best in the nation
  • State Workers’ Compensation costs that are among the lowest in the Midwest
  • Regional intergovernmental cooperation to reduce operating costs
  • Long-standing partnerships among area manufacturers to lower business costs and improve industry performance.

See the most current millage rates from the Saginaw County Equalization Department.

Michigan Taxes

  • Corporate Income Tax 6.00%
  • Personal Income Tax 4.25%
  • Michigan Property Tax (Industrial Businesses) Cut by 65%
  • Michigan Property Tax (Commercial Businesses) Cut by 23%
  • Michigan Sales Tax 6.00%
  • Inventory Tax 0%

Corporate Income Tax – 6.00%

Michigan levies a Single Business Tax (SBT), which is a modified value-added tax (VAT). The rate is 6.00% and there is an additional modified gross receipts tax at a rate of .8%. For 2019, The Tax Foundation ranked Michigan’s corporate tax as 11th best in the nation, up from 49th in 2012.

Personal Income Tax – 4.25%

Michigan’s personal income tax rate is one of the lowest in the nation – a flat 4.25% tax rate that is scheduled to decline in the next few years.

Michigan Property Taxes – 65% / 23%

While tax rates vary by location, Michigan’s property tax system provides automatic exemptions that effectively cut personal property taxes by: 65% for industrial businesses; 23% for commercial businesses

In 2019 the Tax Foundation ranked Michigan’s average property tax 22nd lowest in the nation.

Michigan's Sales Tax – 6%

The state sales tax is 6% on sales of tangible goods. No local sales taxes are allowed.

Michigan’s flat sales tax of 6% is the 11th best sales tax rate according to the Tax Foundation’s 2019 analysis.

Tax Exempt Purchases

There is no state sales tax charged on:

  • Manufacturing machinery and equipment
  • Electricity and natural gas used in production
  • Pollution control equipment

Inventory Tax – 0%

Michigan has no inventory tax.

Additional property tax abatements available to Michigan businesses include:

  • Locally-negotiated abatements, including 100% new real property exemptions available in specified communities
  • 50% abatements for up to 12 years on real property for industrial processors and high-tech companies

In 2014 Michigan reformed its personal property taxation:

  • Small taxpayer exemption – all industrial and commercial personal property owned by a business is exempt if the combined true cash value is less than $80,000
  • Eligible for exemption – Eligible Manufacturing Personal Property (EMPP) used at least 50% of the time in industrial processing or direct integrated support of industrial processing

Unemployment Insurance

To protect workers who lose their jobs through no fault of their own, Michigan businesses pay unemployment insurance on the first $9,000 of wages paid to each worker in a calendar year. Established employers may pay as little as 0.06%.

The unemployment insurance rate is based on the experience rating of the business, which varies depending on how many employees draw unemployment insurance benefits. The new employer rate is 2.7%. Once a business is established in Michigan, businesses’ experience ratings vary between 0.06% and 10.3%.

Workers’ Compensation Insurance

Michigan has a competitive workers’ compensation (WC) insurance system. Michigan’s “open competition” system allows market forces to set the WC insurance rates, thus enabling companies to shop among nearly 250 insurance carriers for the best, lowest-cost options.  Self-insurance, group self-insurance, deductible plans, and other options are available as well. With such a wide-range of cost-savings opportunities, Michigan businesses can play a significant role in containing or reducing their WC costs.

The information provided above is only a summary of the most current information available. Please consult a tax specialist when considering all business ventures.