Gov. signs mining severance tax into law

House Bills 6007-6012, introduced by State Representative Matt Huuki, have been signed by Governor Rick Snyder.  The legislation will 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.”

 State Sen. Tom Casperson, R-Escanaba, and Humbolt Township Supervisor Joe Derocha were on  hand Thursday as Gov. Rick Snyder signs the “Michigan Nonferrous Metallic Minerals Extraction Severance Act” into law, sponsored by Rep. Matt Huuki, R-Atlantic Mine.


“This is transformative legislation that will have far-reaching implications as it is simple, fair and transparent and, as such, is sure to attract mining companies to explore and invest in the Upper Peninsula, creating good-paying jobs and inspiring economic development in the region,” said Casperson.


“Sen. Casperson saved the day with his extraordinary efforts in helping draft and pass legislation that was fair to the area and the U.P.,” said Derocha. “This landmark legislation reflects sound tax policy that is fair and not only helps move the U.P. forward but also helps local units of government and those we serve meet the many demands that are placed on them.”