LANSING - House Democratic Leader Richard E. Hammel (D-Mt. Morris Township), Democratic Floor Leader Kate Segal (D-Battle Creek) and Democratic members of the House Tax Policy Committee said at a Capitol press conference today that the proposed Republican tax cut offers as little as five cents a day for most of Michigan’s struggling families while offering more relief to higher wage earners. The proposed tax cut is part of the Fiscal Year 2012-13 budget under consideration in the Legislature, and was announced after the May Revenue Estimating Conference found additional money because of increased tax revenues.
“We certainly need to give tax relief to our hard-working families, but this proposed tax cut ends up benefitting the wealthy and not doing much at all to help the average Michigan family,” said Hammel. “This tax proposal would save a family of three earning $50,000 less than a nickel a day spread out over an entire year. That nickel will get you about 3 minutes on a parking meter, 5 pony rides for a child on a grocery store mechanical horse, two ounces of milk at $2.99 a gallon or a shot glass worth of gas at $3.60 a gallon.”
The proposed tax cut would lower the tax rate early starting in October 2012 from 4.35 percent to 4.25 percent, and increase the personal exemption by $250. The tax rate was scheduled to decrease in 2013 anyway, so the Republican tax cut is only for three months in 2012 as opposed to the hefty $1.8 billion tax cut given to corporations last year. For a family of three making $50,000 per year this would save them less than a nickel a day.
“Our families and senior citizens who are reeling from the tax increases last year deserve more than an election year political stunt that barely gives any tax relief to the people who need it most,” said Segal. “Once again, the Republicans are showing that they are completely out of touch with the majority of Michiganders and what it costs to live here under their tax policies. Restoring the Earned Income Tax Credit for low wage-earning families as well as restoring the child tax credit would put the focus of tax relief on middle class families who have lost more than most in the past year.”
A family of three with a taxable income of $1.8 million would see a savings of $455 for the three months of 2012 that the rate reduction and increased exemption would cover. Last year’s $1.8 billion corporate tax cut also benefitted the wealthy while seniors, students, and average families paid for that tax cut through the pension tax, school funding cuts, and the loss of family-friendly tax credits.
# # #