Reps. Yanez, Switalski, Roberts, Introduce Plan for Middle-Class Tax Relief

Legislators call for action as Michiganders struggle with new tax laws

State Representatives Henry Yanez (D-Sterling Heights), Jon M. Switalski (D-Warren) and Sarah Roberts (D-St. Clair Shores) 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.

“Many people look forward to this time of year because it means they will get a little extra money in their pockets, but not this year,” said Yanez. “It’s the people that need that extra money the most - our seniors and our middle-class families - that are being hurt by the Republican tax changes now in effect. My colleagues and I are fighting to undo these burdensome tax changes so this is one of the only years people deal with this.”

Last session, the Republican-led Legislature made severe changes to the Michigan tax code punishing middle-class families and seniors, including imposing a tax on retirement income, eliminating the Homestead Property Tax Credit for many families, 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.

“Many people were blindsided this year with a much smaller return or no return at all,” said Switalski. “That’s money that could have been used to fix a car or make necessary home repairs, and money that would have been put right back into our communities. The Republican tax overhaul’s negative impacts are much more widespread than they realize.”

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.

“Any amount of relief that we can offer Michigan families is well worth the fight we have ahead of us to get our tax initiatives passed,” said Roberts.