New Budget Deal Includes Scaled Back Pension Tax

LANSING (WWJ) – Michigan Governot Rick Snyder has announced a revised tax plan that would exempt the retirement income of those over age 66 from state income tax.

Snyder, Tuesday, reached a new budget agreement with key Republican leaders in the state House and Senate, with ta concession from the Governor in the form of a modified pension tax proposal.

WWJ Lansing Bureau Chief Tim Skubick reports that although Snyder’s original proposal included all private pensioners, the Governor has agreed to modify his plan — and Republican state leaders have agreed with him.

Skubick said the new proposal calls for phasing in or scaling back the tax.

If the new plan passes, those are 67 or older, who are on a pension right now, will pay no tax at all.

“The key part for this deal, for the Governor, is he will now bring on board, supposedly, some Senate Republicans who were just dead set against an cross the board pension tax. So, modifying the pension tax not to impact current pensioners is a deal-maker for the Governor,” Skubick said.

In addition, Skubick said the new budget deal will include a freezing of the Income Tax rate at its current level of 4.35 percent.  Previously, the Governor said he had wanted to roll that back.

Skubick said that there will also be a new $150 million in cuts beyond what Governor Snyder had originally proposed.  

The measure now moves on to the full legislature for consideration.

“This deal is one thing — getting it through the legislature is quite another,” said Skubick, adding that the deal  makes the Governor’s hope for an overall budget agreement by the end of May more of a possibility.

“This breakthrough on the budget deal between the two Republican leaders and the Governor will make a major step in that direction. There’s still a lot of heavy lifting to do. May 31st is reasonable. A lot of people in this town believe, however, the middle of June might be more realistic,” he said.

Stay with WWJ for the latest.

  • L. Weaver

    I was laid off a few years before 55 and unable to find work in my field, so I retired at 55 on a much reduced pension. Now this governor wants to reduce it further at the same time he leaves his pension and those of other public workers untouched? I just can’t believe the arrogance.

  • Governor Snyder to Visit West Michigan - Barack Obama Videos

    […] Read more on CBS Detroit […]

  • Eleanore B.

    When are we going to tax government workers’ pensions? If we eliminated their pensions altogether I’m sure we could save the state a lot of money. After all, they only serve for a maximum of 6 years – the rest of us don’t earn a pension after working for that minimal amount of time. Public service jobs are supposed to be just that – service, not feeding at the public trough for the rest of your life.

  • JOHN

    How ignorant …. Now he plans to pit seniors against seniors :( IGNORANT!!

  • Bob Holmberg

    If you are young, and need a job,,,,,,you have to leave Michigan.

    If you are retired, and want to protect your pension,,,,,,you have to leave Michigan.

    What and who is going to be left?

  • Mich. Supreme Court To Hear Pension Tax Arguments « CBS Detroit

    […] Snyder said his revised tax plan would exempt the retirement income of those over age 66 from state income […]

blog comments powered by Disqus
Best Winter Festivals In Metro Detroit
Thanksgiving Parade Guide

Watch & Listen