HB-4051, As Passed House, March 3, 2015

HOUSE BILL No. 4051

January 22, 2015, Introduced by Reps. Farrington and Chang and referred to the Committee on Tax Policy.

A bill to amend 1941 PA 122, entitled

"An act to establish the revenue collection duties of the

department of treasury; to prescribe its powers and duties as the

revenue collection agency of this state; to prescribe certain

powers and duties of the state treasurer; to establish the

collection duties of certain other state departments for money or

accounts owed to this state; to regulate the importation, stamping,

and disposition of certain tobacco products; to provide for the

transfer of powers and duties now vested in certain other state

boards, commissions, departments, and offices; to prescribe certain

duties of and require certain reports from the department of

treasury; to provide procedures for the payment, administration,

audit, assessment, levy of interests or penalties on, and appeals

of taxes and tax liability; to prescribe its powers and duties if

an agreement to act as agent for a city to administer, collect, and

enforce the city income tax act on behalf of a city is entered into

with any city; to provide an appropriation; to abolish the state

board of tax administration; to prescribe penalties and provide

remedies; and to declare the effect of this act,"

by amending section 28 (MCL 205.28), as amended by 2014 PA 240.

THE PEOPLE OF THE STATE OF MICHIGAN ENACT:

Sec. 28. (1) The following conditions apply to all taxes

administered under this act unless otherwise provided for in the

specific tax statute:

(a) Notice, if required, shall be given either by personal

service or by certified mail addressed to the last known address of

the taxpayer. Service upon the department may be made in the same

manner.

(b) An injunction shall not issue to stay proceedings for the

assessment and collection of a tax.

act, the department may institute an action at law in any county in

which the taxpayer resides or transacts business.

(d) The state treasurer may request in writing information or

records in the possession of any other department, institution, or

agency of state government for the performance of duties under this

act. Departments, institutions, or agencies of state government

shall furnish the information and records upon receipt of the state

treasurer's request. Upon request of the state treasurer, any

department, institution, or agency of state government shall hold a

hearing under the administrative procedures act of 1969, 1969 PA

306, MCL 24.201 to 24.328, to consider withholding a license or

permit of a person for nonpayment of taxes or accounts collected

under this act.

(e) Except as otherwise provided in sections 23a and 30c, the

state treasurer or an employee of the department shall not

compromise or reduce in any manner the taxes due to or claimed by

this state or unpaid accounts or amounts due to any department,

institution, or agency of state government. This subdivision does

not prevent a compromise of interest or penalties, or both.

(f) Except as otherwise provided in this subdivision, in

subsection (6) or (7), or in section 23a, an employee, authorized

representative, or former employee or authorized representative of

the department or anyone connected with the department shall not

divulge any facts or information obtained in connection with the

administration of a tax or information or parameters that would

enable a person to ascertain the audit selection or processing

criteria of the department for a tax administered by the

department. An employee or authorized representative shall not

willfully inspect any return or information contained in a return

unless it is appropriate for the proper administration of a tax law

administered under this act. A person may disclose information

described in this subdivision if the disclosure is required for the

proper administration of a tax law administered under this act or

the general property tax act, 1893 PA 206, MCL 211.1 to 211.155,

pursuant to a judicial order sought by an agency charged with the

duty of enforcing or investigating support obligations pursuant to

an order of a court in a domestic relations matter as that term is

defined in section 2 of the friend of the court act, 1982 PA 294,

MCL 552.502, or pursuant to a judicial order sought by an agency of

the federal, state, or local government charged with the

responsibility for the administration or enforcement of criminal

law for purposes of investigating or prosecuting criminal matters

or for federal or state grand jury proceedings or a judicial order

if the taxpayer's liability for a tax administered under this act

is to be adjudicated by the court that issued the judicial order. A

person required to disclose information under section 10(1)(j) of

the Michigan economic growth authority act, 1995 PA 24, MCL

207.810, may disclose the information only to the individuals

described in that section. A person may disclose the adjusted gross

receipts and the wagering tax paid by a casino licensee licensed

under the Michigan gaming control and revenue act, 1996 IL 1, MCL

432.201 to 432.226, pursuant to section 18, sections 341, 342, and

386 of the management and budget act, 1984 PA 431, MCL 18.1341,

18.1342, and 18.1386, or authorization by the executive director of

the gaming control board. However, the state treasurer or a person

designated by the state treasurer may divulge information set forth

or disclosed in a return or report or by an investigation or audit

to any department, institution, or agency of state government upon

receipt of a written request from a head of the department,

institution, or agency of state government if it is required for

the effective administration or enforcement of the laws of this

state, to a proper officer of the United States department of

treasury, and to a proper officer of another state reciprocating in

this privilege. The state treasurer may enter into reciprocal

agreements with other departments of state government, the United

States department of treasury, local governmental units within this

state, or taxing officials of other states for the enforcement,

collection, and exchange of data after ascertaining that any

information provided will be subject to confidentiality

restrictions substantially the same as the provisions of this act.

The state treasurer or a person designated by the state treasurer

may disclose the address of each housing unit that is part of a

housing project exempt from ad valorem taxes under section 15a of

the state housing development authority act of 1966, 1966 PA 346,

MCL 125.1415a, or under section 11a of 1933 (Ex Sess) PA 18, MCL

125.661a, and whether the unit is subject to a service charge in

lieu of ad valorem taxes. The state treasurer or a person

designated by the state treasurer may also disclose the millage

rates of property taxes as defined in section 512a of the income

tax act of 1967, 1967 PA 281, MCL 206.512a.

(2) A person who violates subsection (1)(e), (1)(f), or (4) is

guilty of a felony, punishable by a fine of not more than

$5,000.00, or imprisonment for not more than 5 years, or both,

together with the costs of prosecution. In addition, if the offense

is committed by an employee of this state, the person shall be

dismissed from office or discharged from employment upon

conviction.

(3) A person liable for any tax administered under this act

shall keep accurate and complete records necessary for the proper

determination of tax liability as required by law or rule of the

department.

(4) A person who receives information under subsection (1)(f)

for the proper administration of the general property tax act, 1893

PA 206, MCL 211.1 to 211.155, shall not willfully disclose that

information for any purpose other than the administration of the

general property tax act, 1893 PA 206, MCL 211.1 to 211.155. A

person who violates this subsection is subject to the penalties

provided in subsection (2).

(5) A person identified in section 10(1) of the Michigan

economic growth authority act, 1995 PA 24, MCL 207.810, who

receives information under section 10(1)(j) of the Michigan

economic growth authority act, 1995 PA 24, MCL 207.810, as

permitted in subsection (1)(f), shall not willfully disclose that

information for any purpose other than the proper administration of

his or her legislative duties nor disclose that information to

anyone other than an employee of the legislature, who is also bound

by the same restrictions. A person who violates this subsection is

responsible for and subject to a civil fine of not more than

$5,000.00 per violation.

(6) The department shall annually prepare a report containing

statistics described in this subsection concerning the Michigan

business tax act, 2007 PA 36, MCL 208.1101 to 208.1601, for the

most recent tax year for which reliable return data have been

processed and cleared in the ordinary course of return processing

by the department. A copy of the report shall be provided to the

chairpersons of the senate and house of representatives standing

committees that have jurisdiction over matters relating to taxation

and finance, the director of the senate fiscal agency, and the

director of the house fiscal agency. The department shall report

the following information broken down by business sector and,

provided that no grouping consists of fewer than 10 taxpayers, by

firm size in compliance with subsection (1)(f) and in a manner that

does not result in the disclosure of information regarding any

specific taxpayer:

(a) Apportioned business income tax base.

(b) Apportioned modified gross receipts tax base.

(d) Use of credits.

(e) Modified gross receipts tax liability.

(f) Total final liability.

(g) Total liability before credits.

(7) A person may disclose the following information described

in this subsection:

(a) Information required to be reported under section 455 of

the Michigan business tax act, 2007 PA 36, MCL 208.1455.

(b) An application to enter into an agreement, a communication

denying an application to enter into an agreement, an agreement, a

postproduction certificate, a communication denying a

postproduction certificate, or the total amount of credits claimed

in a tax year under section 455 of the Michigan business tax act,

2007 PA 36, MCL 208.1455, notwithstanding section 455(6) of the

Michigan business tax act, 2007 PA 36, MCL 408.1455.

denying an application to enter into an agreement, an agreement, an

investment expenditure certificate, a communication denying an

investment expenditure certificate, or the total amount of credits

claimed in a tax year under section 457 of the Michigan business

tax act, 2007 PA 36, MCL 208.1457, notwithstanding section 457(6)

of the Michigan business tax act, 2007 PA 36, MCL 408.1457.

(d) An application to enter into an agreement, a communication

denying an application to enter into an agreement, an agreement, a

qualified job training expenditures certificate, a communication

denying a qualified job training expenditures certificate, or the

total amount of credits claimed in a tax year under section 459 of