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Governor Rick Snyder and GOP legislative leaders reach budget deal that could lower income taxes


 It appears a budget deal between Governor Rick Snyder and the Legislature’s Republican leaders could include an election year tax cut. An early version of the proposal would accelerate a drop in the state income tax rate and increase the personal exemption.

The governor and G-O-P leaders want to wrap up the budget by the end of next week.

 Governor Snyder says he was skeptical at first, but he says revenue projections look promising enough to at least start talking about a tax cut for individuals and families.

“The way I view it is I’m a taxpayer, too, and if I could get a little more relief, I would be happier about it,” Governor Snyder said.

Snyder says his support for an income tax rollback hinges on the state first paying down a big chunk of its debt, and putting more money into its “rainy day” savings.

Democrats say the talk of an income tax cut is an election year conversion for Republicans. They say GOP tax reductions for businesses have forced families to pick up more of the tax burden. They also schools and universities have also suffered.  

State Representative Rick Hammel is the House Democratic leader.  

“We’ve done great harm to middle class and working families with some of the decisions that were made in tax policy and here we are within six months, less than six months from an election and we’re going to start talking about helping middle class families. That should have been done a year and a half ago,” Hammel said.

Last year, the governor and the Legislature cut the state’s main business tax while ending a dozen tax credits and exemptions for individual filers.

G-O-P state Representative Pete Lund says last year was about improving the state’s business climate and fixing the budget.

"We’ve got more revenue coming in this year, so instead of spending the money, the state telling people what they think is the best way to spend it, give the money back the people since it’s their money – not even give it back the people – take less away from them,” Lund said.

The proposed deal would also increase some funding to roads and education.

A proposed $180 million dollars would be added to the schools budget, including money to for the school employees retirement system and money for K-12 classrooms.

From The Detroit News: http://www.detroitnews.com/article/20120524/POLITICS02/205240393#ixzz1vmcyypCG



Rick Pluta is Senior Capitol Correspondent for the Michigan Public Radio Network. He has been covering Michigan’s Capitol, government, and politics since 1987.