Whitmer vetoes bills to bring tax refund for businesses' PPE purchases
Lansing — Michigan Gov. Gretchen Whitmer vetoed bills Friday that would have allowed businesses to seek refunds for taxes paid on the purchases of personal protective equipment during the COVID-19 pandemic.
The bills aimed to institute exemptions from the state's 6% sales tax and impacted purchases of personal protective equipment by businesses with COVID-19 safety protocols in place if the purchases occurred from March 10, 2020, the day Michigan reported its first coronavirus infections, to Dec. 31, 2021.
In a letter explaining her veto, the Democratic governor said she would support a grant program to help small businesses defray the cost of personal protective equipment. However, the bills would create a tax credit, making the expense ineligible for federal COVID-19 relief dollars through the American Rescue Plan, the stimulus program signed into law earlier this year.
"I encourage the Legislature to send me bills that would allow us to send these federal relief dollars to hard-working business owners who’ve kept their employees and customers safe over the past 15 months," Whitmer said.
The bills had widespread support in the Legislature, passing the Senate in 36-0 votes on June 2. They passed the House in 102-7 votes on June 8.
Brad Williams, vice president of government relations for the Detroit Regional Chamber, said in a political era when there is very little cooperation across party lines, there was "overwhelming bipartisan support" for the legislation.
"Such bipartisanship deserves to be celebrated rather than vetoed," Williams added.
An analysis by the nonpartisan Senate Fiscal Agency said the proposals would impact government revenues "by an unknown and potentially significant amount." Potential revenue loss likely would exceed $18 million per year, the analysis said, depending on how many taxpayers implemented a COVID-19 safety protocol.
Under the legislation, a person seeking a refund would have to submit their COVID-19 safety protocol plan and a record of their purchases.
Tori Sachs, executive director of the conservative Michigan Freedom Fund, criticized Whitmer on Friday for vetoing the bills while state government has billions of dollars in budget surpluses and federal relief dollars to spend.