LANSING, Mich. — While many political stories in the U.S. focus on primary elections, Canadian cross-border carriers might want to keep a closer eye on Michigan’s finance committee.

A bill that if passed would exempt Canadian trucking companies from the onerous new Michigan Business Tax (MBT) cleared its first hurdle Jan. 17 when the state’s Senate finance committee unanimously voted in favor of sending the bill to the full Senate for approval.

The bill was sponsored by the chair of the committee, Republican Nancy Cassis.

The MBT was announced in October 2007 and the service tax was introduced as a package to deal with the state’s decreased budget. The senate is also debating a tax credit for Michigan businesses who took hits during a two-month span while preparing for the new service tax. Estimates have put losses to businesses in the state anywhere between $30 million and $360 million.

In testimony before the committee in the state capital, Ontario Trucking Association president, David Bradley, urged Senators from both the Republican and the Democratic sides to support the bill.

“Ontario carriers that operate into and out of Michigan, and do not have a permanent establishment in the state already pay their fair share of taxes for use of the state’s highway infrastructure and other programs by way of the International Fuel Tax Agreement and the International Registration Plan,” he said. “But most importantly, Ontario follows international tax norms and does not impose a similar tax on Michigan businesses.”

This concern was echoed by a number of senators and chairwoman Cassis added that Michigan should not invite retaliation by Ontario. The bill was also supported by the Michigan Chamber of Commerce.

“Michigan and Ontario are part of the same supply chain. Our economies, particularly automotive manufacturing are highly integrated,” added Bradley. “In that sense Ontario is not your competitor and we need to make sure we don’t further burden our domestic industries so that we are even less able to compete with the world’s emerging economies.”

A spokesperson from Michigan Treasury said the department agreed with the intent and concepts, though not necessarily through a blanket solution. Nevertheless, the treasury did not block the bill from moving forward and committed to working with OTA, its legal representatives and the Canadian Consulate in Detroit to address OTA’s concerns.

“There is still a lot of work to do; we need to get the full senate to pass the bill. It also needs to be approved by the House of Representatives and ultimately by the Governor. But, today’s result was a great start,” said Bradley.