LANSING – The Single Business Tax is out and the Michigan Business Tax is in - if legislators approve Gov. Jennifer Granholm’s new tax plan.

With the single business tax (SBT) set to expire on Dec. 31, 2007, Granholm is pushing fast action on her proposal to replace the tax and to replace the $1.9 billion a year it generates.

And she’s making the issue a top priority during the Legislature’s lame duck session.

Sharon Parks, vice president of the Michigan League of Human Services, said 23 percent of the state’s general revenue comes from the SBT, and 85 percent general state spending covers programs in the Department of Community Health, higher education, human services, corrections and other services.

“It’s important that we keep a balance in terms of who pays for public services and programs,” Parks said.  “It was irresponsible of the Legislature to eliminate the tax without replacement revenue identified.”

The Department of Treasury’s press secretary, Terry Stanton, said businesses can’t afford to wait too long for a new plan.

“Michigan’s business community is awaiting a new tax plan,” Stanton said.  “We can’t just flip the switch and have a tax plan work.  The sooner the better.”

Michael Shore of the Michigan Economic Development Corp. also said businesses need an immediate plan.

“The biggest single uncertainty in Michigan’s business climate is what the tax situation will be,” Shore said.  “No business wants to relocate to Michigan if they don’t have services.”

Shore said there will be significant reductions in the state’s budget if the tax isn’t replaced.

And Parks said, “It’s important that we keep a balance of who pays for public services and programs. The tax should be replaced with another business tax, not a tax that falls on families and individuals.”

The Granholm proposal projects 77 percent of businesses would pay less in taxes. It would also provide a tax cut of $150 million.

Granholm’s plan includes eliminating the tax on payroll, benefits and health care, and providing personal property tax reduction to industrial and commercial taxpayers.

The proposal offers a $125 million tax cut to technology companies that receive grants from the 21st Century Jobs Fund.

Liz Boyd, Granholm’s press secretary, said the proposal is revenue-neutral, meaning it would raise the same amount of money as the SBT.

Senate Majority Leader Ken Sikkema, R-Wyoming, said the Legislature should move fast to make a decision, and he is reserving comment on Granholm’s plan.