Senate subcommittee approves MacGregor’s human services budget

LANSING, Mich.—The Michigan Senate Appropriations Subcommittee on Human Services approved the Fiscal Year 2016 Department of Human Services (DHS) budget on Thursday, said Chairman Sen. Peter MacGregor.

“This is a fiscally responsible budget with strategic investments and smart reforms and reductions that reflects the Senate recommendations for the Department of Human Services,” said MacGregor, R-Rockford, the sponsor of Senate Bill 124. “Over the next couple months, we will work with the House of Representatives and the governor to put together a final budget through the conference committee process.

“I am confident this budget will help the department achieve its goals of helping Michigan residents meet their financial, medical and social service needs by putting people first so they can more quickly become self-sufficient and successful.”

The bill now heads to the full Senate Appropriations Committee for consideration.

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Senate Finance Committee approves MacGregor’s cloud computing tax exemption bill

LANSING, Mich. — Legislation sponsored by state Sen. Peter MacGregor exempting Internet-based software services from state sales and use tax was approved by the Senate Finance Committee on Tuesday.

“Simply put, the state of Michigan should not be taxing the services provided by these Internet-based companies,” said MacGregor, R-Rockford. “By enacting this legislation, we will create certainty and predictability for job providers in our state, which will encourage technology companies to locate and grow in Michigan.”

In the software as a service (SaaS) model, which can also be referred to as cloud computing, software is not sold or distributed physically. Instead, SaaS involves a provider using its own hardware and proprietary software to provide a service to customers using their own hardware remotely. Unlike the legacy distribution model, the SaaS licensing model differs in that a perpetual one-time license fee has been replaced by a subscription model.

For the end user, this means that, for example, in order to use Citrix’s GoToMeeting video conference software or Microsoft’s Office 365 services or Adobe’s Creative Cloud suite, a person must be a subscriber in order to access and use the software.

Currently the state’s sales and use tax applies to prewritten computer software (tangible goods) but does not apply to these services. This legislation, therefore, clarifies that granting the right to use prewritten software installed on remote servers is not subject to the state’s sales and use tax.

Senate Bill 82 and its companion, SB 83, sponsored by Sen. John Proos, now go to the full Senate for consideration.

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