LANSING -- Gov. Rick Snyder’s proposed budget he presented to the legislature on Thursday raises taxes on the most vulnerable and shifts taxes from corporations to kids, senior citizens and workers.
Reaction to the budget proposal was negative and widespread, with one Senate Republican saying Snyder’s proposal to tax pensions was a “non-starter.” Gilda Jacobs, the President o of the Michigan League for Human Services, said Snyder and Lt. Gov. Calley clearly broke their own rule when they said reforming the state's tax system should not pick winners and losers. The executive budget reduces business taxes by $1.8 billion but increases taxes on seniors and families by $1.7 billion.
"We have missed a great opportunity to modernize Michigan's outdated tax system,“ she said. “Instead, the administration has proposed one that simply shifts taxes from businesses to vulnerable kids, families and seniors.”
Senate Democratic Leader Gretchen Whitmer, D-East Lansing, also said Snyder failed to follow through on his previous pledge of moving all of Michigan forward instead of the same old politics of putting corporate tax breaks ahead of the people.
“Governor Snyder’s idea of shared sacrifice seems to mean that working families will do most of the sacrificing while companies continue to reap the rewards,” she said. “He is balancing this budget on the backs of our kids, working families, and our seniors. Contrary to his rhetoric about ‘moving all of Michigan forward’, this budget picks out who he’s willing to leave behind.”Among the cuts proposed include making all public and private pensions subject to state income tax, with the exception of Social Security income. This was discussed last legislative session because Michigan is only one of thee states that do not tax pensions, but the discussion included exempting a large portion of the pension income.
Among the many personal income tax credits eliminated or reduced including a reduction in the homestead property tax credit.
It also includes deep cuts to revenue sharing to cities, villages and towns, and it will trim the fund from nearly $300 million to $200 million. It will surely cause local governments to lay off police and firefighters. It will also push some municipalities into bankruptcy.
It comes at a time when Michigan Republicans are putting bills on the fast track that places dictator-like powers in the hands of unelected officials appointed from Lansing with no oversight. House Bills 4214-4218, approved out of committee on Wednesday, will repeal Public Act 72, the current law governing emergency financial managers (EFM), and give them more power and make it even easier for one to be appointed.
The Michigan State Police will have to pick up more patrols because of the loss of officers and entire departments, but the budget proposal calls for closure of Michigan State Police posts to save $3.2 million.
The campaign rhetoric of jobs, jobs, jobs is just that. He wants to eliminate business credits for brownfield redevelopment, the Michigan Economic Growth Authority, Next Energy, advanced battery, film and renaissance zones. Already, films are looking elsewhere to film, and advanced battery manufacturing has huge growth positional in Michigan. He is actually killing jobs.
He is also mortgaging the future at a time when high-tech jobs are the wave of the future, and he is calling for cutting some $420 per-pupil in public education funding. That will devastate school districts, sending many into deficit districts.
He is also calling for concessions of $180 million from state employees. He also plans to eliminate the Earned Income Tax Credit, GOP Saint Ronald Reagan called the “best anti-poverty, the best pro-family, the best job creation measure to come out of Congress.” That move will raise taxes on some 800,000 Michigan low-income workers.
The various appropriations sub-committees will now start meeting to dissect the budget.