Michigan Economic Development Corporation (MEDC)

The MEDC is the state-wide economic development organization whose mission is to market Michigan and provide the tools and environment to drive job creation and investment

The MEDC provides services, resources and incentives covering access to capital, B2B opportunities (Pure Michigan Business Connect), finding talent, loans to small and mid-sized companies, funding to redevelop buildings in urban areas, and cash-based incentives for locating and expanding companies.

Michigan offers one of the best pro-business environments in the country. We have been ranked one of the Top 10 states for corporate tax competitiveness due to our simple, fair and efficient 6% corporate income tax and $500 million in annual business savings through the elimination of industrial personal property tax.

Michigan provides millions of dollars in support each year for business expansions and growth through our resources, incentives and loans.

Individual Income Tax
Michigan’s individual income tax rate is one of the lowest in the nation – a flat 4.25% tax rate that is scheduled to decline in the next few years.

Sales Taxes
The state sales tax is 6% on sales of tangible goods. No local sales taxes are allowed.

• There is no state sales tax charged on:
  Manufacturing machinery and equipment
• Electricity and natural gas used in production
• Pollution control equipment

Unemployment Insurance
To protect workers who lose their jobs through no fault of their own, Michigan businesses pay unemployment insurance on the first $9,500 of wages paid to each worker in a calendar year. Established employers may pay as little as 0.06%.

The unemployment insurance rate is based on the experience rating of the business, which varies depending on how many employees draw unemployment insurance benefits. The new employer rate is 2.7%. Once a business is established in Michigan, businesses’ experience ratings vary between 0.06% and 10.3%.

Workers’ Compensation Insurance
Michigan has a competitive workers’ compensation (WC) insurance system. Michigan’s “open competition” system allows market forces to set the WC insurance rates, thus enabling companies to shop among nearly 250 insurance carriers for the best, lowest-cost options. Self-insurance, group self-insurance, deductible plans and other options are available, as well. With such a wide-range of cost-savings opportunities, Michigan businesses can play a significant role in containing or reducing their WC costs. The following sources will help you understand and navigate through the WC insurance system.