LANSING - Changes in the Michigan tax code that shifted the tax burden from major corporations to middle-class families have failed to produce the jobs Republicans promised and have led to stagnant state revenues, Michigan House Democrats said Friday, the day of the annual Consensus Revenue Estimating Conference. Without an increase of dollars coming in to the state, the House Democratic Caucus said legislators must be more deliberate with spending decisions than ever before and allocate taxpayer funds to the things people care about most, such as education and public safety.
“Legislative Republicans have been busy ripping up Michigan’s tax code over the past two years, making middle-class families and seniors pay for $1.8 billion in tax breaks to some of the biggest corporations in the world,” House Democratic Leader Tim Greimel (Auburn Hills) said. “Instead of creating the jobs Republicans promised, shifting the burden onto the backs of Michigan families has devastated the public school system, left our communities less secure and our roads crumbling. This year’s Revenue Estimating Conference clearly shows the Republican tax plan doesn’t work. It’s time to start undoing the damage.”
Net revenue to the state’s general fund is estimated to be $8.79 billion for fiscal year 2012-13, a 5.1 percent decline from the previous estimate made in May 2012. Looking ahead to fiscal year 2013-14, the conference estimates the state’s general fund will receive $9.26 billion in revenue, while the School Aid Fund is estimated to see $25.8 million less than the projection made in May 2012.
“The revenue estimates unveiled today show that the governor’s reverse-Robin Hood policies are failing the people of Michigan,” Representative Jim Townsend (Royal Oak) said. “Taking from the middle class and low-income families and giving tax breaks to wealthy CEOs and shareholders is no way to create jobs or manage our state’s budget. The governor promised this would cause corporations to start hiring. Instead, we’ve seen $2 billion diverted from public education and huge cuts to local government, which makes it harder for communities to pay for police officers and firefighters. Our kids’ futures and our communities are now at risk, and our state budget is still out of balance.”
House Democrats urge the governor and Legislature to make school funding and public safety their top priority when creating a budget this year.
“When Michigan families and seniors file for state returns this year, they will feel the pain from the Republican tax policy changes, including the college tuition, child tax credits and tax on pensions,” said Rep. Rashida H. Tlaib (Detroit), the House Democrats’ nominee for minority vice chair of the House Appropriations Committee. “These tax changes are slowing down Michigan’s economic recovery by taking money out of the pocketbooks of Michigan families and handing it over to corporations in the form of tax cuts. This was supposed to create jobs, but that hasn’t happened, and our unemployment rate is still above the national average. Families now have less money to spend in their local economy, while corporations reap the benefits.”