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.


One Comment

  1. L. Weaver says:

    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.

  2. Eleanore B. says:

    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.

  3. JOHN says:

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

  4. Bob Holmberg says:

    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?

Leave a Reply

Fill in your details below or click an icon to log in:

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s

More From CBS Detroit

Best Fall Festivals In Metro DetroitFrom music to art to special events, there's a little something for everyone's delight.
Best 4th Of July Concerts In Metro DetroitStaying home this weekend? Celebrate the 4th of July by rocking out at one of these shows.

Watch & Listen