Pro-CU Bill Passed, No Time To Be Complacent
On a scale of 1-10, the tax threat in Michigan is about a five. In December, the governor signed the Michigan Credit Union Act (MCUA) modernization bill into law. Even with this monumental passage, credit unions must remain vigilant against any type of tax threat from the banking industry. Although there has been no indication that state lawmakers intend to re-examine Michigan's state-chartered credit unions' tax-exempt status, the governor has expressed the desire to review the state's entire tax structure as a means to create additional revenue for the state. The motive behind this initiative is largely due to the state's changing economy and the phase-out of the single business tax, scheduled for 2010 (state-chartered CU's do not pay the SBT). While this objective seems to focus mainly on business taxes, State Treasurer Jay Rising, who is leading the effort, has expressed the possibility of expanding sales tax on certain services, including financial services.