Michigan has rolled-back withholding tax from 4.25% to 4.05% for 2023 yet they refuse to change the tax tables for the year.  See the references below..."Treasury takes a neutral position on adjusting withholding amounts. If 2023 withholding amounts are not modified, your employees or retirees will receive the adjustment (a larger refund or less tax owed) when filing their Michigan income tax return in 2024."  

Sage will not receive payroll tax updates because Michigan will not submit them.  This is unfair to our employees.  Can we manually change the withholding tax rate to the actual percentage (we are using Sage Payroll 2.23)?  

https://www.michigan.gov/taxes/-/media/Project/Websites/taxes/Forms/2023/2023-SUW/446_Withholding-Guide_2023.pdf?rev=918974d55e8a495f9e9e09e7eb8633d9&hash=BF28F7AADDF4DD1FE4087225389FC625

Tax Rate Change: Income Tax

Per MCL 206.51, the Michigan income tax rate may be lowered each tax year if certain economic conditions were met in the last fiscal year (October 1st – September 31st). Based on recently finalized financial data from fiscal year ending September 30, 2022, the 2023 Michigan income tax rate decreased to 4.05%.

Businesses, persons, and fiduciaries may have questions about how this change impacts tax obligations and resources for the 2023 tax year (January 1, 2023 through December 31, 2023).

• 2023 individual income tax forms will be released with the lowered income tax rate.
  
  
• 2023 withholding tables will not be updated to reflect the reduced income tax rate.
  
  
• Treasury takes a neutral position on adjusting withholding amounts. If 2023 withholding amounts are not modified, your employees or retirees will receive the adjustment (a larger refund or less tax owed) when filing their Michigan income tax return in 2024. 
  
  
• This is not a permanent change to Michigan's income tax rate; it is expected to return to 4.25% on January 1, 2024.