State Rep. Sue Allor today cast her vote in support of a plan to provide genuine tax savings for Michigan families, seniors, and veterans throughout the state.
The $2.5 billion tax relief plan, made possible by a large surplus of state revenue, would return money to taxpayers by cutting the income tax rate and boosting savings for individuals, working families, seniors, and veterans.
“Michiganders are struggling due to the massive price increases on everyday essentials such as groceries and gas,” said Allor, of Wolverine. “I fundamentally believe that people, not government, are the best stewards of their hard-earned tax dollars. As a Legislature, we must always look at ways for Michigan residents to keep more of their income, and it’s even more important now as costs continue to rise.”
The plan would lower the individual income tax rate across the board from 4.25% to 4% and increase the personal income tax exemption by $1,800. Seniors age 67 and older who may currently deduct $20,000 of income individually or $40,000 jointly would be eligible for an increase of $1,800 or $3,600, respectively, with future increases automatically adjusted for inflation.
Families would also be eligible for a $500 nonrefundable tax credit for each dependent 18 years old or younger. The state Earned Income Tax Credit, which offers savings for lower-income families and individuals, would be increased from 6% to 20% of eligible income — a change the governor has previously supported.
Under current state law, a veteran with a permanent and total disability resulting from military service is exempted from paying property tax on his/her home. The plan would also apply this exemption to an eligible veteran’s surviving spouse. Veterans with a disability determined to be between 50% and 100% would be eligible for a property tax credit up to $2,000. Finally, the state would reimburse local governments the amount of revenue lost related to these exemptions.
The bulk of the tax plan, contained in House Bill 4568, passed the Senate and House of Representatives today and now advances to the governor for consideration. The remainder of the plan in Senate Bill 784 is expected to pass early next week.