Severance tax reform will help create good-paying jobs in UP

Upper Peninsula mining companies will now have a fair and equitable system of taxation that encourages job creation and economic development under legislation signed into law today by the governor, state Rep. Matt Huuki announced.

House Bills 6007-6012, introduced by Huuki, place a 2.75 percent severance tax on gross mineral value on specified non-ferrous metallic minerals such as copper and nickel. The tax replaces the property tax, corporate income tax, sales tax and use tax on mining companies.

“This is phenomenal news for the people of the Upper Peninsula, who need more good-paying jobs that the mining industry can offer,” said Huuki, R-Atlantic Mine. “The new tax reforms will lower start-up costs to encourage companies to locate here while protecting existing mining jobs.”

The bills allow 65 percent of the revenue from the severance tax to be retained by counties, townships, school districts and the school aid fund. The remaining 35 percent would go into a rural development fund to support long-term regional economic opportunities.

“I’d like to thank the governor for seeing the tremendous merits of this legislation,” Huuki said. “These are common-sense measures that benefit everyone. Instead of charging taxes on the potential for future mining, it’s smarter and more fair to levy severance taxes on minerals as they are removed from the earth.”

Source:  Press Release –

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