MEGA would make it more difficult to lower overall tax levels.
One of the certain but unintended consequences of the MEGA program would be increased difficulty in achieving across-the-board tax reform. When tax revenues are used in some way, alternative uses are forgone. When taxes are credited back to employers, the alternative uses of those tax revenues are given up.
Crediting tax revenues to selected large corporations does two things. First, it lowers the amount of revenue that could be used to fund an overall reduction in the SBT rate, thereby preventing a lower tax burden for all businesses subject to the SBT. Second, such credits diminish the incentive for those firms lucky enough to receive the credit to lobby for further reform. Those states that aggressively pursue selective tax credit schemes to lure away business are actually reducing their ability to produce an overall, competitive business climate with each arbitrary subsidy or rebate contrivance they create. Michigan can foster superior and sustainable growth, as it is already proving, if it spends less energy on a few trees and cares instead for the forest as a whole.