House Democrats announce 6-bill legislative package to provide middle-class tax relief
State lawmakers from Washtenaw County joined with fellow House Democrats on Monday to announce a new plan for middle-class tax relief in Michigan.
A package of six bills, House Bills 4561-4566, are focused on restoring tax credits and deductions to middle-class families and repealing taxes on retiree pensions. Legislation included in the plan would relieve the tax burden on Michigan families when next year's tax season rolls around, Democrats say.
Washtenaw County's four state representatives, shown in this photo from November, are backing a tax relief plan for middle-class workers and senior citizens.
Ryan J. Stanton | AnnArbor.com
Last session, the Republican-controlled state Legislature made several changes to Michigan's tax code, imposing a tax on retirement income, eliminating the Homestead Property Tax Credit for many families, cutting the Earned Income Tax Credit and eliminating a $600 per-child deduction and tax credits for charitable donations. Democrats argue those changes have hurt middle-class families and seniors and were needed only to help offset $1.8 billion in tax breaks for businesses.
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.
"People across Michigan are seeing reduced refunds or actually have to submit a payment, while corporations are paying much less than they used to," said state Rep. Jeff Irwin, D-Ann Arbor. "This tax shift hasn't helped create jobs, so we need to reverse it and put that money back where it'll do the most good — into the pockets of middle-class families."
Gov. Rick Snyder has defended the tax reforms, saying a right-sizing of business and personal taxes was overdue when he took office and Michigan's tax system is now fairer and more efficient.
He also has said there no doubt would be some short-term pain felt, but the result is a state budget that is fiscally sound, and that's going to be attractive to businesses.
The House Democrats' bill package, which they're calling Michigan's Middle-Class Plan, includes repealing the new tax on retirement income, restoring the Earned Income Tax Credit to 11 percent in the first year, requiring employers to inform employees about the Earned Income Tax Credit, restoring the Homestead Property Tax Credit and restoring the child deduction. Another bill would ban the tax deduction for expenses incurred by moving a business out of state.
"The economy is starting to turn around, but we can't afford to derail that recovery by putting a bigger tax burden onto families and seniors," said state Rep. David Rutledge, D-Superior Township. "We will work to protect hard-working Michiganders from arbitrary increases in taxes that do nothing to invest in the programs and systems that could make their lives better."
State Rep. Adam Zemke, D-Ann Arbor, said putting money back into the pockets of middle-class families means more can be spent at local businesses, which he called a win-win situation.
MLive reported House Republicans have criticized Democrats for basing their budget priorities around a series of unrealistic revenue sources.
"The Democrats claim they want to cut taxes one day and raise spending the next," said Ari Adler, a spokesperson for House Republicans. "That results in unbalanced budgeting that can only be called leadership if you live in fantasy land."
Ryan J. Stanton covers government and politics for AnnArbor.com. Reach him at ryanstanton@annarbor.com or 734-623-2529. You also can follow him on Twitter or subscribe to AnnArbor.com's email newsletters.
Comments
clownfish
Tue, Apr 16, 2013 : 12:49 p.m.
Whoops! Watch as the low tax crowd comes out against low taxes! I think nationally the dems should propose doing away with income tax, and the GOP wold object loudly and demand higher income taxes.
A Voice of Reason
Tue, Apr 16, 2013 : 12:48 p.m.
I think these "fab-4" democrats are pandering to their base and assume that people in the middle class are uneducated and not bright. We need to fund education and the middle class pays a majority of the taxes because they are the largest group and work. You can't have it both ways. Now all retires pay the same amount, not just sweetheart deals for rich union workers. A majority of the middle class, especially small business owners who do not have pension, so finally you are making life "fair" for all retirees and everyone is paying their "fair share". My parents (who have a pension), even though they are not crazy about paying more taxes, they think it is fair that their pension are taxed. Smart people understand that fair mean equal.
Carole
Tue, Apr 16, 2013 : 10:38 a.m.
Yep, we sure are doing with much less - between all of the increases in taxes, there is very little to help the economy. Gas prices are out of sight, all insurances have increased. Yep, doing with much less.
Jay Thomas
Mon, Apr 15, 2013 : 10:36 p.m.
Quick! We've got to be one of only four states that gives a sweetheart deal to the unions. How else will the democrats receive all the campaign contributions from union members they so righteously deserve? You could make 100k/year from two government pensions and pay zippo! Back to the days when they didn't pay their "fair share".
OLDTIMER3
Tue, Apr 16, 2013 : 1:47 p.m.
$1300 a month sure doesn't add up to $100000 a year.Plus since Obummer care started my copay on meds has tripled.
clownfish
Tue, Apr 16, 2013 : 1:25 p.m.
So, would you say that giving tax breaks to people that donate to the GOP would be the same or different than dems giving tax breaks to union members that donate? For instance, DeVos was acknowledged at the privately held Koch seminar in June 2011 in Vail, Colorado for donating at least $1 million to Koch-related causes. Other contributions by the DeVoss- 10/28/10-$10,000: MICHIGAN REPUBLICAN PARTY 09/29/11-HUIZENGA, WILLIAM P (R-MI) $2400, 10/08/10: BOOZMAN, JOHN (R-AR) $2400, 10/06/10-BENISHEK, DANIEL J (R-MI) $2400, 09/30/10- AMASH, JUSTIN (R-MI) $2400, 09/30/10 BENISHEK, DANIEL J (R) $2400, 09/30/10 HUIZENGA, WILLIAM P (R) $2400, 07/22/10 ALLEN, JASON EDWARD (R-MI) , 06/30/10 AMASH, JUSTIN (R-MI) $1400, 11/25/09 REPUBLICAN NATIONAL COMMITTEE (R) $30,400, 11/13/09 MICHIGAN REPUBLICAN PARTY (R) $9000, Mr Devoss had his business taxes dropped significantly by the state and national GOP. Were those that received donations from the Kochs and DeVosses righteously deserving, and were those tax breaks righteously deserved?
leaguebus
Mon, Apr 15, 2013 : 9 p.m.
These bills are doomed. I don't see where they were endorsed by the Koch brothers. I paid $1400 more and I just retired. I would not object to a tax increase if the damage was across the board for all. But the "job creator" class and businesses skated. So did the Rickster. See you at the polls in 2014,
Judy
Tue, Apr 16, 2013 : 4:32 p.m.
Gee Basic Bob, I am not rich (my husband and I together is less then 45, 000 a year), and I had to pay an additional $221 dollars these year and last year I got over $600 back. Both parties are only looking out for themselves and do what they have to, to get voted back in to office to spend our money, they have the best benifits and pay for with little chance of being fired.
Basic Bob
Tue, Apr 16, 2013 : 12:38 a.m.
rich folks like you should pay more
An Arborigine
Mon, Apr 15, 2013 : 7:40 p.m.
I appreciate having representation of my interests and could really use my homestead property tax credit that Snyder and the boys stole from me and gave to their corporate cronies.
David Cahill
Mon, Apr 15, 2013 : 6:59 p.m.
I like this package!
jcj
Mon, Apr 15, 2013 : 6:29 p.m.
Great idea.Lets go back to the whole State being on track to go bankrupt! Sure it cost me about $1500 compared to last year, but I am willing to help get the State back on sound footing.
fjord
Mon, Apr 15, 2013 : 6:27 p.m.
There's no point in further cutting taxes on the middle class if you aren't also raising taxes on the wealthy and businesses. The state needs MORE revenue, not less. Low tax revenues are one the main causes — perhaps THE main cause — of the financial malaise we've been in for the past several years. Republicans don't know how to do anything but cut taxes, and that means less for essential services like public safety, public education, and road repair. And as for Snyder's "right-sizing" of business and personal taxes — that was just a gift to his wealthy and corporate backers. We need to take that gift back and fix our roads and schools.
fjord
Tue, Apr 16, 2013 : 10:04 a.m.
I was criticizing the Democrats for acting like Republicans, but obviously that was lost on you.
Superior Twp voter
Tue, Apr 16, 2013 : 3:12 a.m.
Laughable comment that seldom deserves a reply. Will they ever learn?
Jay Thomas
Mon, Apr 15, 2013 : 10:41 p.m.
In case you've missed the last five years nationally, the democrats solution has been to create more government make work jobs. Harry Reid says we never have enough and the socialists in France went on a hiring binge even though many government departments said they didn't need new hires. The entire West is going over a cliff with this madness. Next stop... the USSR.
EyeHeartA2
Mon, Apr 15, 2013 : 6:45 p.m.
"Republicans don't know how to do anything but cut taxes" Did you bother to read the article? This is what the Dems are proposing. Keep drinking the kool-aid.
Greg
Mon, Apr 15, 2013 : 6:09 p.m.
Still do not understand why people who want to have kids expect others to help pay their tax burden. You want to have kids, no problem, but expecting tax breaks for doing so is not correct.
Chimay
Tue, Apr 16, 2013 : 8:50 p.m.
Wah wah wah! Let's invest in rich people, not children! I work for a living too and don't mind paying for education or for children. It's better than paying for prisons and for corporations that do nothing good for people. Snyder's tax breaks don't work: http://bit.ly/15ML1tn
Judy
Tue, Apr 16, 2013 : 4:18 p.m.
dotdash, I agree with Greg and SMAIVE on this one. The problem is the more working taxpayers give the the 1 in 5 kids parents the more these same kids grow up thinking we owe it the them, I-phone, flat screen TV's, ect. All things I do not have and I work for a living.
dotdash
Mon, Apr 15, 2013 : 6:54 p.m.
Some remarks speak for themselves.
dotdash
Mon, Apr 15, 2013 : 6:52 p.m.
The child credit is aimed at supporting families and keeping kids fed. 1 in 5 kids is raised in poverty. It has a phase-out at AGIs over a certain amount, so it is targeted pretty carefully. I should add that people (like me) support it, even if they can't take advantage of it. I do, however, take advantage of other tax breaks (mortgage interest deduction, for example) and I suspect if you look carefully, you'll find that you do, too.
SMAIVE
Mon, Apr 15, 2013 : 6:47 p.m.
I'll pay indirectly for school, parks and recreation cause I received the benefit, but the rest of upkeep is up to the breeders who couldn't put a sock on it.
grye
Mon, Apr 15, 2013 : 5:55 p.m.
If you take in less money, what services will be cut?
dotdash
Mon, Apr 15, 2013 : 5:50 p.m.
I appreciate the work on behalf of families. The child credit is a big deal. Can we also get the roads fixed, please?
you can't handle the truth
Mon, Apr 15, 2013 : 5:30 p.m.
Hurry up! Let's undo all that Snyder did to fix the Granholm disaster!!! I want to go back to those days!
David Paris
Tue, Apr 16, 2013 : 2:02 a.m.
Reall? "Back to those days", like, you mean, yesterday?