Legislation was introduced immediately reducing the state income tax rate to 4.05%, as of January 1, 2025. According to the bill sponsor, this will help address the rising costs that families are facing, including groceries, housing, and childcare.
Key Points:
-
- House Bill 4170 was introduced by Representative Kathy Schmaltz (R-Jackson).
- In 2015, legislation was signed into law by then-Governor Rick Snyder, which requires a reduction to the income tax whenever state general fund revenues grow faster than inflation.
- This provision was triggered in 2023, reducing the tax rate from 4.25% to 4.05% for only one year. There has been division over whether the reduction should have been permanent. Under the proposal, the reduction would be permanent, barring future legislative action.
Next Steps:
-
- The bill was referred to the House Finance Committee for consideration.
