Snyder, Legislative Leaders OK State Income Tax Cut
LANSING (WWJ) – Gov. Rick Snyder has reached an agreement with legislative leaders to give voters a tax cut this year.
Snyder initially told reporters on Wednesday that he opposed the cut, saying he’d rather use the $96 million to boost the rainy day fund or pay down state debts. But later in the day said he agreed with a proposal to provide $90 million in relief to individual taxpayers out of a bigger-than-expected budget surplus.
The state’s 4.35 percent income tax rate is scheduled to drop to 4.25 percent on Jan. 1.
GOP House Speaker Jase Bolger wants to give the tax relief sooner, increase the amount at which income taxes kick in or combine the proposals.
Critics say moving up the tax cut is a political ploy to help Republican House members win re-election this fall. But Gov. Snyder says that’s not it at all — that it has to be considered in the context of what he calls a responsible budget.
“It’s a very thoughtful budget. It’s dealing with long term liabilities,” Snyder told WWJ Lansing Bureau Chief Tim Skubick. “There are no acounting gimmicks. There’s additional funds for the rainy day fund.
“So, in all those contexts if those are hit and those are done in a good context and there’s resources available, I don’t view that as a political move …” Snyder said.
Skubick said for the average Michigan family the savings will only amount to about $7 per year. But lawmakers believe the symbolism of an income tax rate cut will continue to help in Michigan’s economic recovery.
Meantime, some retirees and other voters are unhappy they’ll be paying more under GOP-sponsored tax changes.
(TM and © Copyright 2012 CBS Radio Inc. and its relevant subsidiaries. CBS RADIO and EYE Logo TM and Copyright 2012 CBS Broadcasting Inc. Used under license. All Rights Reserved. This material may not be published, broadcast, rewritten, or redistributed. The Associated Press contributed to this report.)