Sen. Jack Brandenburg, a Harrison Township Republican, is calling for a return to the state’s previous plan to lower the state income tax several more notches.
“This was a promise made to the Michigan taxpayers during the budget crisis of 2007 when the personal income tax was temporarily raised to 4.35 percent, with the clear understanding that it would be rolled back to 3.9 percent permanently within a few years. Our current tax law provides only for a one time roll back to 4.25 percent on January 1, 2013, and this is not good enough,” Brandenburg said in a statement earlier this week.
The lawmaker’s bill (Senate Bill 906) would gradually reduce the tax rate by 0.1 percent per year beginning on January 1, 2014, until the rate goes back to the 3.9 percent level near the end of the Engler era.
The rollback was largely cast aside during the big tax shakeup proposed by Gov. Snyder last year which resulted in big cuts for businesses once the Legislature took action.
The rollback established by Snyder would save a typical Michigan worker with a $50,000 income about $50 a year starting Jan. 1. Brandenburg’s incremental rollback to a 3.9 percent rate would not be completed until January 2017, when that same worker would see his paycheck deduction fall by about $4.30 a week, compared to current conditions.
In addition, the true savings would be less once the worker took advantage of various deductions and exemptions on the state income tax form to lower his taxable income.
Nonetheless, Brandenburg said he believes his bill would aid struggling families and restrict the size of state government.
“We need to keep our word to Michigan taxpayers who have been hard hit by a combination of rising costs of food, gasoline, health insurance and college tuition,” he said. “These statutory tax decreases will also provide a safeguard against the creation of bigger state government as Michigan tax revenues rise because of the recovery of the Michigan auto industry.”
