They need extensive reforms that can relieve stress from their finances as much as possible.
The legislature has stepped up comprehensive tax reforms that provide real relief. The plan I developed was integrated into the bill recently vetoed by Governor Gretchen Whitmer included a $ 2.5 billion annual tax credit – a reduction in the income tax rate from 4.25 percent to 3.9 percent for all taxpayers. This reduction stems from a previous commitment to restore the rate after it was raised during the administration of Governor Jennifer Grenholm. The plan also created a non-refundable tax credit for children of $ 500 for each eligible dependent. Income exemptions for people 62 and older, as well as additional retirement income benefits, would see some seniors eligible for savings of $ 40,000 as a single filing or $ 80,000 for co-applicants. Michigan workers, families and seniors would save more of what they earned.
Gov. Gretchen Whitmer said in her annual address to the state that she wants to put Michigan in the first place. But the tax plan she has been pursuing gives priority to certain Michigan residents, while the legislature’s plan provides broad relief for all. For the elderly, the governor’s plan focuses on state retirement income rather than social security payments and 401 (k), as the legislature’s plan does. The legislature’s approach has also given new exceptions to about 275,000 people between the ages of 62 and 67, helping more fixed-income people save as they see rising costs.
Prices for the gas pump are also rising – a record for the national average – and the legislature is seeking to reduce costs through tax breaks.
Our plan sets a six-month suspension of the state tax on gas and diesel at about 27.2 cents per gallon. This will give people a total savings of about $ 750 million. Governor Whitmer has called on Congress to pass a law to suspend the federal gas tax, an overly confusing strategy that will save the average driver 39 percent less.
And that’s when Washington, DC decided to act. Congress is consistently an entity in which there is a lot of attention, while the Michigan legislature listens to people across the state who now need help, and prioritizes help in return. It’s the best deal you can actually make – really a matter of dollars and meaning.
There have been many concerns about whether these cuts are sustainable. It is important that we use the surplus funds to replenish vital tax revenues through the budget process. Local communities that need these revenues to fund local road repairs should not be left out because of playing in the money money chairs. The state still has significant federal funding for assistance that can be used for these types of issues, and the legislature has set priorities for many one-time funding measures, so the state does not make commitments that it cannot meet in the future.
What is not sustainable or controversial is the troublesome financial crossroads at which many people in Michigan are now finding themselves due to extraordinary costs. The people I talk to in the regions I represent do not believe for a second that the state cannot afford to introduce such cuts. They have seen the budget grow by billions in just the last few years, and realize that their tax dollars have helped ease the flow of federal funding that has overwhelmed the state treasury.
We need to find ways to give people back as much money as possible so that they can better address these current issues. The governor should prioritize pocket wallets in our state now, instead of worrying about what campaign promises on taxes and spending may not come true.