Employers could pocket half of new workers' state income taxes

Individual income tax: credit; payroll withholding credit; provide for. Amends 1967 PA 281 (MCL 206.1 - 206.847) by adding sec. 714. TIE BAR WITH: HB 5292'25

Introduced· 2025-11-13

Who's it for

Who's it for: Big Business

What it means for you

4/10Mixed

Mixed: some good, some bad ·

Cost shift

Plain‑English summary, cross‑checked against the official bill text.

This bill allows businesses to keep half of the state income taxes they withhold from new employees, diverting up to $50 million a year from public funds to employers.

Our take

What we think, in plain words.

Instead of sending your withheld income taxes to the state to pay for roads and schools, this bill lets your boss keep half of it as a reward for hiring. While it does require these new jobs to pay well above the local average, it is essentially a $50 million yearly subsidy for businesses paid directly out of the taxes withheld from workers. Half of the money is set aside specifically for massive corporations with over 1,000 employees.

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The facts

What the bill actually says, no spin.

Lets employers keep 50 percent of the state income taxes withheld from new workers' paychecks.
Costs the state up to $50 million a year in lost tax money.
Reserves at least $25 million of the yearly money for large companies with over 1,000 workers.
Requires the new jobs to pay at least 50 percent more than the local average wage.
Blocks companies from getting the money if they lay off more than 5 percent of their current workers.