House Sends Sweeping Tax Changes To Governor

LANSING (WWJ/AP) - It's a huge win for Governor Rick Snyder.  The Michigan House has sent a series of sweeping tax changes to him, for his signature, after the measure narrowly passed the Senate.

The broad plan would cut overall business taxes, eliminate some tax credits and reduce tax breaks for retirees and low-income workers.

The Republican House majority approved the main bill in the package, 56-52. Earlier, the Republican-led Senate passed the bill by a 20-19 vote, as some Republicans joined Democrats opposing the bill.

"As the Senate Republican Leader, Randy Richardville has been telling us all day, he had the votes to pass it and indeed he did, " said WWJ's Lansing Bureau Chief Tim Skubick.

"We also talked to the Governor. He is very pleased that lawmakers are moving on this," Skubick said.

The tax proposal is key to the Republican governor's plan to reinvigorate the state and make it more competitive for attracting businesses.

State Senate Republican Mark Jansen of Grand Rapids said it was a difficult vote.

"You're gonna go home and somebody's gonna yell at ya. They're gonna yell at ya because you cut K-12, or they're gonna yell at ya because you changed the tax system and made it more fair," he said.

Democrats say the overall business tax cuts come largely at the expense of retirees who will have some of their income taxed and lower-income workers.

"With Michigan's economy leading the nation out of a recession, Governor Snyder and his Republican Legislature threaten to derail it by ramming through the largest redistribution of wealth in our state's history," said State Democrat Representative Maureen Stapleton, in a statement.

"This is not shared sacrifice, nor good government. While Governor Snyder cannot guarantee a single job will be created by his corporate tax giveaway to lobbyists and lawyers, Michigan retirees will pay the tab," she said.

State Senate Democrat Rebekah Warren of Ann Arbor also opposed the legislation.

"The message we kept hearing from the administration... is we needed a business tax that was simple, fair and efficient.  The challenges that I've had with this package, as introduced, is I don't believe it's simple, I don't believe it's fair and I certainly don't think it's efficient," Warren said.

Business Leaders for Michigan, the state's business roundtable, applauded the passing of this legislation that President and CEO Doug Rothwell says will "significantly improve Michigan's ability to grow and compete for jobs."

"To grow jobs in Michigan -- for any sector, for any size company- - we need to make Michigan more competitive.  Taxes do matter as they are a part of the cost of doing business in a state. The legislation passed today ends double taxation of small and medium-sized entrepreneurial companies that serve as the economic engines in many communities and sends a clear message that Michigan is serious about competing for business," Rothwell said, in a statement.

Some Republicans opposed the bill because of its income tax provisions.

The Associated Press contributed to this report.