Five months into his new job, Michigan Governor Rick Snyder signed an eight-bill package eliminating the state's business tax, simplifying the tax structure and pursuing economic competitiveness.

Among those applauding the moves is Roger Runyon, chief financial officer of multi-brand dealership Fraza Forklifts, a Blackwood Holdings company with about 200 employees.

The changes in the law should cut Fraza Forklifts' effective tax rate to 6% from 28%, allow the dealership to hire more employees and reduce both tax preparation time and payments to an accounting firm, according to Runyon.

In addition to its Plymouth headquarters, Fraza Forklifts has full-service Michigan branches in Roseville, Warren, Romulus and Bridgeport.
In select markets, Fraza Forklifts represents the Caterpillar, Mitsubishi, Jungheinrich, Linde, JLG, Clark, Sellick and Hoist brands.

Snyder says: "The current tax system is riddled with inequities that are hostile to job growth. Eliminating these long-standing barriers will level the playing field for taxpayers, encourage entrepreneurship and spur more investment in Michigan."

Snyder, a Republican, took office as governor of Michigan on 1 January. Previously, he was chief executive officer, chairman of the board and co-founder of Ann Arbor, Michigan-based venture capital firm Ardesta LLC.

Republican State Rep Jud Gilbert, sponsor of the legislation, says, "This legislation not only relieves the double taxation burden carried by many small businesses but also empowers these businesses - already known as significant job creators - to spur additional job growth in Michigan."

Democrats in the legislature harshly criticise elimination of the business tax and express serious doubts about the potential for job creation.
The Council on State Taxation notes that the changes should take Michigan to 16th place from 30th in the nation in terms of lowest state and local business tax burden.

The Michigan business tax is replaced by a 6% corporate income tax that applies mainly to stock-issuing companies. Nearly 100,000 businesses will no longer have to file returns.