Michiganders to see major savings under Lowering MI Costs Plan
“This important moment is the culmination of years of Democrats demanding that leaders put real people and their real needs first,” Senate Majority Leader Winnie Brinks said. “We know our plan helps seniors who have carefully budgeted for their golden years and it helps those who are working hard but earning the least. We are very proud to be delivering meaningful relief to folks in our first weeks in the new majority.”
A key component of the bill will expand the Working Families Tax Credit to 30% of the federal Earned Income Tax Credit. 700,000 Michiganders—those who have the hardest time affording the basics—will see an average of $3,150 dollars back in their pockets starting this year. This element of the bill was spearheaded by Sen. Kristen McDonald Rivet (D-Bay City), who earlier this year announced a coalition of 230 business groups, economic development organizations, health care and hospitality entities, faith organizations and more urging action on this important policy.
“Today the Michigan Senate passed the Working Families Tax Credit to provide financial relief to over 700,000 Michigan families and almost a million children,” said Sen. McDonald Rivet. “These dollars represent one of the largest tax breaks in Michigan’s history, and I am proud to have introduced it in the Senate.”
Democrats have called for ending the unfair and unpopular tax on retirees since it was put in place more than a decade ago by the previous administration. Lowering MI Costs phases out the retirement tax over four years and ultimately puts an average of $1,000 back in the pockets of 500,000 households. The plan, led by Sen. Kevin Hertel (D-St. Clair Shores) in the Senate, equalizes the exemption on both public and private retirement income.
“Our proposal incorporates the needs of more seniors and the various types of retirement income they depend on while ensuring that this tax break targets those most in need,” said Sen. Hertel. “Reforming Michigan’s unfair retirement tax is good policy that restores the promise that was broken a decade ago and enables our seniors to live and retire with dignity.”
The Lowering MI Costs Plan also invests $50 million of surplus tax revenue in the state’s Housing and Community Development fund, which prioritizes projects offering veterans, seniors, people with disabilities, and working families safe, affordable places to call home. This is significant, sustainable and ongoing dedicated funding to affordable housing. The plan also provides $50 million for Revitalization and Placemaking (RAP) grants to turn underutilized office, commercial, or community space into places for people to enjoy, including affordable housing, parks, outdoor dining spaces, community gathering places, and more.
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