House Dem Leader Greimel, Reps. Abed and Cochran Introduce Plan for Middle Class Tax Relief

Legislators call for action as Michiganders struggle with new tax laws
Monday, April 15, 2013

LANSING - House Democratic Leader Tim Greimel (D-Auburn Hills), and state Representatives Theresa Abed (D-Grand Ledge) and Tom Cochran (D-Mason) today announced the House Democrats’ plan for middle-class tax relief. The bills, based on Michigan’s Middle Class Plan, are focused on restoring tax credits and deductions to middle-class families and repealing taxes on retirees. Legislation included in the plan will relieve the tax burden on Michigan families when next year’s tax season rolls around.

“Today, Michigan middle-class families and senior citizens know all too well how the Republican tax increases have unfairly burdened them,” said Greimel. “It’s time Republicans realize how much damage their tax policies have done, and work with us to support bills giving much-needed tax relief to struggling families and seniors.”

Last session, the Republican-led Legislature made severe changes to the Michigan tax code that punished middle-class families and seniors, including a new tax on retirement income, eliminating the Homestead Property Tax Credit for many homeowners, a drastic cut to the Earned Income Tax Credit and the elimination of the $600 per-child tax deduction and tax credits for charitable donations. These changes were made to fund nearly $2 billion in tax breaks for big corporations, effectively making Michigan’s low-income and middle-class families pay for a handout to big corporations. The new taxes took effect in 2012, and many taxpayers became aware of them for the first time as they filed their state income taxes this year.

“I have heard repeatedly from residents in my district that they are shocked and outraged over the tax changes that are directly hurting seniors who have no way to make it up and struggling families who are trying to make ends meet,” said Rep. Abed. “From emails, letters, calls to my office and talking to people at my coffee hours, I have heard over and over again how hard the tax changes have hit them. Many have had their return dramatically cut and some even end up owing taxes. This is money seniors and families were relying on to pay property taxes, make needed repairs and catch up on bills. Michiganders deserve better than to lose money so that big corporations can have tax breaks.”

Over the past two months, Democratic state representatives heard the concerns of struggling Michiganders during their Real State of Our State Listening Tour. After the tour’s completion, legislators used this feedback to construct Michigan’s Middle Class Plan, including the following tax initiatives:

  • Repeal the new tax on senior retirement income
  • Require employers to inform employees about the Earned Income Tax Credit
  • Restore the Earned Income Tax Credit to 11 percent in the first year
  • Restore the Homestead Property Tax Credit
  • Restore the child deduction

Along with these initiatives, the House Democrats pledge to continue fighting against tax increases on the middle class and seniors every time a new, harmful tax is introduced to the Legislature, and to keep Michigan taxpayers aware of the changes through a series of town halls held across the state.

“The tax relief plan that we are proposing will bring real relief to Michigan families,” said Rep. Cochran. “If we want a strong economy in our state then our middle-class families and senior citizens have to be able to afford to live here. It’s important to pass our bills because they will put money back in the hands of our families so they can take care of their needs.”