Snyder and Calley ask state Legislature for swift action on exemption issue
Monday, Jan. 8, 2018
LANSING, Mich. – After federal tax reform effectively eliminated the personal exemption at the state level, leading to an annual $1.5 billion tax increase on Michiganders, Gov. Rick Snyder and Lt. Gov. Brian Calley developed a simple and fair proposal to restore the exemption.
Snyder and Calley worked with the state Department of Treasury over the holiday season to analyze the federal reform and the effects it will have on state income taxes, and are sharing the solution publicly prior to this week’s Consensus Revenue Estimating Conference. The conference aligns state government and economic experts in estimating how much money the state has to spend during the upcoming budget cycle.
“We are putting Michigan families first, by working to enact a simple and fair solution to fix the unintended consequences of the federal tax plan,” Gov. Snyder said. “Everyone working together to limit income taxes on Michiganders is a great way to start 2018.”
Lt. Gov. Brian Calley, who has led prior successful state tax cuts, said: “Over the past seven years, we have worked diligently to simplify the state tax code and lower the tax burden on Michigan families. Restoring and increasing the personal exemption continues on that path – it is direct, effective and simple.”
The recent federal tax reform changed federal tax exemptions to zero. Because federal exemptions are carried over to state tax return forms, legislation is needed to clarify Michigan’s Income Tax Act so that exemptions at the state level can continue.