Bill > HB6523

This bill proposes to add a new section 684 to the Income Tax Act of 1967 in Michigan. The key provisions are: 1. It imposes an annual surcharge on corporations that are required to disclose their pay ratio (the ratio of CEO compensation to median employee compensation) under SEC regulations. The surcharge rate ranges from 0% for a pay ratio of 50 to 1 or less, up to 50% for a pay ratio of 500 to 1 or higher. 2. The surcharge applies to the corporation's tax liability under the Michigan corporate income tax, after allocation or apportionment to the state but before calculating any available credits. 3. The surcharge does not apply to corporations that are not required to file a Michigan corporate income tax return under section 685. 4. If a corporation fails to disclose its pay ratio or discloses it incorrectly, the state Department of Taxation can determine the correct ratio and apply the appropriate surcharge. 5. The surcharge is considered part of the corporate income tax and will be administered, collected, and enforced under the same laws and procedures.