HB 4425 Michigan House · 2025-2026 Regular Session

Corporate income tax: other; sustainable aviation fuel incentive program; create. Creates new act. TIE BAR WITH: HB 4424'25

House Bill 4425 creates the Sustainable Aviation Fuel Incentive Program in Michigan. This program aims to encourage companies to produce or blend sustainable aviation fuel (SAF) within the state by offering corporate income tax credits. The Department of Environment, Great Lakes, and Energy (EGLE) will administer the program, certifying SAF that meets specific criteria, including source materials, technical standards, and a minimum 50% reduction in life-cycle greenhouse gas emissions compared to traditional jet fuel. The bill sets an annual cap on the total amount of tax credits approved, starting at $4.5 million for the 2025-2026 fiscal year and increasing to $9 million annually thereafter.

Bill status in committee 1 of 4 stages cleared

Introduction

May 2025

Committee Review

Floor Vote

Governor

Introduced May 6, 2025 Last action Dec 16, 2025

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What changed between versions

House Introduced Bill → Substitute (H-4) · 4 edits

MODERATE

The bill was amended to reorganize definitions and clarify eligibility criteria for a sustainable aviation fuel tax credit. The most significant change is the addition of a new definition for 'qualified sustainable aviation fuel,' which distinguishes between basic sustainable fuel and fuel that meets stricter certification standards required to claim the tax credit. The application process was also updated to require applicants to provide specific evidence proving their fuel meets these higher standards, particularly regarding greenhouse gas emission reductions.

Scope change

The scope of the program remains focused on incentivizing sustainable aviation fuel production, but the criteria for claiming the tax credit have been made more explicit and rigorous by introducing a separate definition for 'qualified' fuel.

DEFINITION

Added a new definition for 'qualified sustainable aviation fuel' to specifically identify fuel that has been certified by the department as meeting the requirements for the tax credit.

Reordered and slightly modified the list of definitions in Section 3 to include the new 'qualified sustainable aviation fuel' term and updated references to the income tax act.

REQUIREMENT

Updated the application requirements to mandate that applicants submit evidence proving their fuel satisfies the specific criteria for the sustainable aviation fuel tax credit, including data on emission reductions above the 50% threshold.

TECHNICAL

Corrected the definition of 'biomass' to replace 'animal waste' with 'animal fat' and adjusted the citation for the income tax act.

Floor votes

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Full legislative history

Actions timeline

Total actions

Key actions

Committee

Dec 16, 2025

Committee

referred to second reading

lower

Dec 16, 2025

Lower · Passed

reported with recommendation with substitute (H-4)

lower

May 6, 2025

Committee

referred to Committee on Transportation and Infrastructure

lower

May 6, 2025

Introduced

introduced by Representative Rep. Jerry Neyer

lower

1 primary · 17 co-sponsors