House Dems Fight to Give Middle-Class Families a Decent Tax Cut

Nickel a day tax cut will do little for families, senior citizens
Tuesday, June 5, 2012

LANSING - House Democrats today argued that Michigan residents need more tax relief than legislative Republicans are allowing under bills that were moved in place today for a final vote later this week. The bills give the most tax relief to high wage earners, and little relief to middle-class families and average taxpayers.

“Once again, the Republican majority has given more to their friends and failed to reach out to Michigan’s middle-class families and senior citizens to give them meaningful tax relief like they gave to big corporations last year,” said House Democratic Leader Rick Hammel (D-Mount Morris Township). “If they were serious about putting more money back in our residents’ hands then they would have adopted the amendments offered by my Democratic colleagues instead of passing legislation that will only give most taxpayers an extra nickel a day.”

House Bills 5699 and 5700 lower the income tax rate from 4.35 percent to 4.25 percent on Oct. 1, 2012 and increases the personal exemption by a nominal amount. This rollback was scheduled to happen anyway on Jan. 1, 2013. So the small rate reduction that will happen three months early on Oct. 1 will be one-time money.

House Democrats tried to offer genuine tax relief by offering amendments to:

  • Restore the Earned Income Tax Credit (EITC) at 20 percent;
  • Lower the income tax rate to 3.9 percent effective Oct 1, 2012;
  • Repeal the Pension Tax, restore the Homestead Property Tax Credit and restore a number of deductions and credits; and,
  • Provide an additional tax exemption for seniors who are paying more taxes this year because of the senior pension tax.

All of the Democratic amendments were defeated by House Republicans without allowing them to be voted on.

“Michigan families and senior citizens deserve better than a tax reduction that, at five cents a day for a family of three earning $50,000, would take roughly two months to save up for a gallon of milk that costs $3.00,” said House Democratic Floor Leader Kate Segal (D-Battle Creek). “People need tax relief but they aren’t getting it from the Republican administration and legislators. My colleagues and I voted for these bills because this is the best we can get, but it certainly is not the best that we could have done for Michigan taxpayers and we will continue the fight to help our middle-class families.”