TORONTO, Ont. – Michigan Governor Jennifer Granholm has signed into law a bill exempting Canadian cross-border trucking companies and auto parts manufacturers that do not have a permanent establishment in the state, from having to pay the Michigan Business Tax (MBT).

The bill was approved by both the Michigan Senate and the House of Representatives.

According to the Ontario Trucking Association (OTA), which led the fight on behalf of Ontario truckers, the MBT could have cost Ontario trucking companies who operate into, out of or through the state, around US$1,000 per truck per year, had the bill not passed. The OTA estimates that Ontario trucking companies would have been on the hook for at least US$40 million per year. The OTA argued that the MBT is inconsistent with international tax norms, defies the spirit of the Canada-US tax treaty, and runs counter to the way Canadian provinces tax Michigan business.

“We just wanted to be treated fairly,” said OTA president, David Bradley. “This was no slam dunk. But in the end, the legislators were obviously convinced by the merits of our arguments.”