The Michigan Legislature and Governor are providing healthy tax cuts to promote the expansion of indoor farming and indoor fishery industries in Michigan. The Legislature passed changes to existing property tax laws, which were signed by Governor Rick Snyder on January 14th. Jeffrey Moss, a tax attorney at Dawda Mann states,“It is great to see government doing something affirmative to give incentives for certain types of businesses to grow and expand in our state. These two industries promote healthy, local and fresh food. This is a welcome change from the recent trend away from industry specific tax incentives. This type of property tax reduction should not be as costly to the state as the refundable SBT/MBT credits handed out a few years ago.”
These bills (known as Senate Bills 786 and 787) deal respectively with hydroponic greenhouses and indoor fish farms. SB 786 exempts property used for hydroponic growing from property taxes. SB 787, which deals with the indoor fish farms, lowers the taxes on these entities. The resulting property taxes will now be at 25% the previous rate. Local authorities may still apply millages to the fish farms.
Greenhouses and indoor fish farms could gain a greater foothold in the state as they are not dependent on the uncertainties of weather. The Senate hopes that the tax restructuring will encourage more investment in these opportunities, which could provide local jobs, as well. The bills are also consistent with the tax codes of neighboring states as well as Ontario, which would make Michigan an attractive site for establishing more hydroponic greenhouses as well as more aquaculture investment.