Plan reduces income tax for all while providing additional relief to seniors
State Rep. Luke Meerman today announced the House Tax Policy and House Appropriations committees have advanced plans to slash taxes across the board for all Michigan residents and provide financial stability to debt-ridden municipal governments.
“Inflation is skyrocketing and it’s affecting everyone from working families to retired seniors,” said Meerman of Coopersville. “Right now, our state is sitting on more money than it ever has thanks to federal ARPA funds. In our lifetimes, I doubt we will ever see this accumulation of wealth in state coffers ever again. Now is the time to deliver meaningful tax relief to the people of Michigan. We need a permanent income tax reduction that will benefit Michiganders for decades to come.”
Meerman said the House tax plan is better than the governor’s because it cuts taxes for every taxpayer – not just a small percentage of people who have government pensions.
The committees met today during a joint hearing to consider the two bills.
House Bill 5838, approved by the House Tax Policy Committee, provides an estimated $1.7 billion in annual, ongoing tax relief. It starts with rolling back the income tax rate to 3.9 percent – down from the current 4.25 percent – for all individual payers of the Michigan income tax.
Seniors would receive additional relief. The income exempted from taxes for those 62 and older would rise to $20,000 for individual filers and $40,000 for joint filers. An additional exemption would be applied specifically to retirement income – also at $20,000 for single filers and $40,000 for joint filers.
House Bill 5054, approved by the House Appropriations Committee, provides $1.5 billion in one-time funding to reduce debt and improve the finances of public employee retirement systems. Most of the funding would go to pension plans for local governments and road commissions, with an additional $350 million to improve financing in the Michigan State Police retirement system.
HBs 5838 and 5054 now move to the full House for further consideration.
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