What the Republicans did:
Last session, Governor Snyder and the Republican-led Legislature made severe changes to the Michigan tax code punishing middle-class families and seniors, including imposing a tax on retirement income, eliminating the Homestead Property Tax Credit for many families, a drastic cut to the Earned Income Tax Credit and the elimination of the $600 per-child tax deduction and tax credits for charitable donations. These changes were made to fund nearly $2 billion in tax breaks for big corporations, effectively making Michigan’s low-income and middle-class families pay for a handout to big corporations. The new taxes took effect in 2012, and many taxpayers became aware of them for the first time as they filed their state income taxes this year.
Overall, the Republicans:
- Reduced deductions for pension income
- Reduced homestead property tax credit
- Reduced the earned income tax credit
- Eliminated the city income tax credit
- Eliminated the charitable or public contributions credit
- Eliminated the community foundations credit
- Eliminated the homeless shelter/food bank credit
- Eliminated the historic preservation credit
- Eliminated the stillbirth credit
- Eliminated the college tuition and fees credit
- Eliminated the qualified adoption credit
- Eliminated the vehicle donation (“Wheels to Work”) credit
- Eliminated the individual and family development credit
- Eliminated the $600 per child deduction, along with miscellaneous other deductions
According to the May 2013 Consensus Estimates of the Senate Fiscal Agency, House Fiscal Agency and the State Treasurer, Michiganders are losing $4,320,822 every day, all because Governor Rick Snyder wanted to “reinvent” Michigan and create jobs. Unfortunately, it didn’t even do that. On January 1, 2012, the state’s unemployment rate was 8.9 percent. On September 1, 2013, it was 8.8 percent.
Simply put, it didn’t work, and it continues to take money away from middle class Michigan families and seniors and give it to wealthy special interests every day.
How we fix it:
Democratic Legislators have introduced bills to fix the shift Republicans instituted on middle-class families and seniors. This plan was devised after a two-month Real State of Our State Listening Tour earlier this spring.
In the plan, we will:
- Repeal the new tax on senior retirement income (Abed – HB 4564)
- Restore the Homestead Property Tax Credit (Lamonte – HB 4565)
- Restore the child deduction (Brinks – HB 4562)
- Restore the Earned Income Tax Credit to 11 percent in the first year (Dianda – HB 4566)
- Require employers to inform employees about the Earned Income Tax Credit (Cochran – HB 4561)
- Ban the tax deduction for expenses incurred by moving a business out of state (Yanez – HB 4563)
Along with these initiatives, the House Democrats pledge to continue fighting against tax increases on the middle class and seniors every time a new, harmful tax is introduced to the Legislature, and to keep Michigan taxpayers aware of the changes through a series of town halls held across the state.