Michigan legislators consider tax cuts on personal income, corporations

Michigan state income tax rate is 4.25%, and corporate income tax is 6%

Michigan State Sen. Aric Nesbitt is leading the charge back to the original rate.

DETROIT – In 2007, Michigan Governor Jennifer Granholm signed a tax increase from 3.9% to 4.35%, which was supposed to be temporary until 2015.

In 2012 Governor Rick Snyder signed a slight decrease from 4.35% to 4.25%. Now Michigan State Sen. Aric Nesbitt is leading the charge back to the original rate.

“Inflation is making life more difficult for families in the state of Michigan that are experiencing very large surpluses,” Nesbitt said. “So we need to step up and help hard-working taxpayers, small business owners, and our seniors and our working families.”

On the flip side, it’s not necessarily cheap. The Michigan Senate Fiscal Agency said the state will experience reduced revenues of more than $1 billion for the corporate and individual rates. The child credit is just under a billion, prompting State Sen. Stephanie Chang (Detroit) to vote against sending the bill to the Legislature.

“Right now we have a lot of money,” said Chang. “But we can’t necessarily forecast how are things gonna look, you know, in two, three, four years down the line.”

But it is an election year, and it plays well with voters.

“I think it’s good for families right now, considering how tight it is financially,” said Detroit resident Hassan Watkins. “Interest rates are about to go back up, and we need a break.”

“I think it’s great because it’s going to fuel businesses and encourage before business to set up here in the state, translates into more jobs more money in the citizen’s pockets it’s just good for the economy all around,” said Southfield resident Alan Barksdale.

Watch here: Michigan Gov. Whitmer delivers 2022 State of the State address on Jan. 26

About the Authors:

Rod Meloni is an Emmy Award-winning Business Editor on Local 4 News and a Certified Financial Planner™ Professional.

Brandon Carr is a digital content producer for ClickOnDetroit and has been with WDIV Local 4 since November 2021. Brandon is the 2015 Solomon Kinloch Humanitarian award recipient for Community Service.