Whitmer Vetoes Michigan’s Bipartisan Tax Cut Bills | Michigan

(The Center Square) – Michigan’s personal income tax will remain at 4.25% for the foreseeable future after Governor Gretchen Whitmer on Friday vetoed a bipartisan bill that would have lowered it to 4 .0%.

House Bill 4568 and Senate Bill 784 were vetoed or, in the case of SB784, vetoed effective Friday. Bills were blocked, meaning that no bill could pass without the acceptance of the other bill under consideration.

According to a House tax analysis, the bills sought to:

  • Reduce the personal income tax rate from 4.25% to 4.0% effective January 1.
  • Increase the personal exemption amount by $1,800, after inflation adjustments, beginning with the 2023 tax year.
  • Increase the earned income tax credit from 6% of the federal credit to 20% of the federal credit beginning with the 2022 tax year.
  • Provide a non-refundable child tax credit of $500 for tax years beginning on or after January 1.
  • Increase the standard deduction on all types of income for taxpayers age 67 or older to $21,800 for a single filing and $43,600 for a joint filing starting January 1.
  • Require that limits on deduction amounts for certain taxpayers be adjusted annually for inflation beginning with the 2024 tax year.
  • Provide a mechanism for the state to reimburse local government units for the property tax exemption available to veterans classified as 100% disabled and their surviving spouses and expand these exemption provisions to include surviving spouses of soldiers killed in action.
  • Provide a credit of up to $2,000 (adjusted annually for inflation) for property taxes paid by veterans with disabilities at at least 50%.

The cost of the bills would have been offset by the state’s $6 billion surplus.

Lawmakers noted with opprobrium the governor’s vetoes to their most recent attempts to soften the one-to-two blows from inflation and high gas prices.

For example, Whitmer had also vetoed House Bill 5570which would have imposed a moratorium on the state’s 27-cent-per-gallon gasoline tax from April 1 through September 30.

“Unlike the Governor’s targeted relief tactics which will only print more money and make this economic crisis worse, our plan would have provided broad relief to all Michigan taxpayers in these extraordinary times of high inflation,” the official said. Representative Steve Carra, R.-Three Rivers, said in a statement. “Many of our neighbors cannot continue to support rising gas and grocery prices, leading Democrats and Republicans to support this plan. Our Governor simply chooses to work against our Legislature, and therefore , not for people in Michigan.”

The House and Senate reached a compromise on Senate Bill 768 early March, but it was also governor’s veto. As reported by The Center Square, this bill would have included a reduction in the state corporate tax rate from 6% to 3.9%.

The bill would also have provided a $500 dependent child tax credit and more than tripled the earned income credit. In addition, the bill would allow income exemptions for those age 62 and older on savings of $40,000 as a single filer or $80,000 as a joint filer, and expand tax relief. property tax for disabled veterans.

“High prices, driven up by inflation, have plagued northern Michigan families and strained their budgets,” said Rep. Ken Borton, R-Gaylord. “While lawmakers approved a bipartisan, common-sense plan to save Michigan taxpayers their hard-earned dollars and cents, Governor Whitmer has again shown that she is utterly unfazed by the sting of inflation being felt by Michigan workers.”