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Income Tax Rollback Bill Falls Short

Feb 24, 2017

Following a long session day, the House of Representatives fell only a few votes short of passing a bill aimed at reducing the state’s income tax.  As originally introduced, the bill would have incrementally reduced the state’s income tax rate over the next forty years, until the rate was eliminated.  However, following debate and discussion, an amendment was adopted on the House floor that would have instead reduced the rate from 4.25% to 3.9% over the next four years and also paused the rollback if the State’s Rainy Day Fund didn’t have at least a $1 billion balance.  Despite the change, many legislators voiced concerns over the impact the tax rollback would have on the state budget, estimated to be over one billion dollars by the House Fiscal Agency.  Ultimately, the bill failed by a vote of 52-55.  In a statement, Speaker of the House Tom Leonard (R-DeWitt Township) acknowledge it is rare for a Speaker to put a bill up for a vote unless they’re certain they have enough favorable votes to pass the legislation.  However, Speaker Leonard explained his position by stating, “the simple answer is this – I knew we were one or two votes short.  However, I had 51 members in my caucus that stood for tax relief, and many of them wanted to go on record, letting their citizens know their position.  While I could have stopped the vote, I felt it was only fair to allow these members to prove to their constituents that they were willing to deliver on their promise to lower taxes in Michigan.”

Under House Rules, the legislation was reconsidered and may be taken up again at any time, as the bill remains on the House floor.

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