Use Tax Exemption for Large Agricultural Processing Facility Projects

Current understanding

HB 5168 (103rd Legislature) would amend the Use Tax Act (1937 PA 94, MCL 205.91–205.111) by adding section 4mm to create a new use tax exemption for property used in large agricultural processing facility projects. The bill has been introduced; specific eligibility thresholds, project definitions, and application/administration procedures remain to be recorded from the bill text. If enacted, qualifying agricultural processing developers would avoid use tax on covered purchases, reducing project costs while foregoing state use tax revenue.

Evidence log

• 2025-10-30 — Sales tax: exemptions; large agricultural processing facility project exemption; provide for. Amends 1933 PA 167 (MCL 205.51 - 205.78) by adding sec. 4mm.: cross-connection with sales-tax-agricultural-processing-exemption: HB 5169 (sales tax) pairs with the parallel use tax exemption bill to create a matched sales/use tax carve-out for large agricultural processing facility projects — the standard two-bill structure for Michigan transactional tax exemptions. (novelty: 2)

Open questions

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