For Immediate Release: April 8, 2011
Contact: Leigh Fifelski: 517.999.3646
Snyder plans to eliminate child tax credit, investment exemption for seniors
LANSING – Citizens groups today spotlighted tax increases in Gov. Rick Snyder’s budget plan that would negatively impact millions of ordinary Michigan families, including seniors and families with young children.
“You don’t need to be a CPA to understand that Gov. Snyder’s budget would raise taxes on virtually every middle class family in the state,” said David Holtz, executive director, Progress Michigan.“Eliminating tax credits for children and exemptions for seniors’ investment income would put a pinch on pocketbooks and stifle our economic recovery. Raising taxes on middle class families to pay for a $1.8 billion tax break for corporations is the wrong approach, and won’t help move our state forward.”
According to an analysis by the nonpartisan House Fiscal Agency, Snyder’s tax plan would:
- Eliminate the child deduction. The child deduction provides a $600 subtraction from adjusted gross income (AGI) for each dependent child age 18 or younger.
- Eliminate the city income tax credit.
- Eliminate the dividends, interest, capital gains exemption received by seniors. Under current law, senior investment income up to $10,058 single/$20,115 joint (TY 2010, indexed to inflation) is exempt.
- Eliminate the $2,300 (TY 2010, indexed to inflation) special exemptions for seniors and individuals with unemployment compensation equal to or greater than 50% of their AGI.
These tax credits would be eliminated along with the Earned Income Tax Credit and the exemption for retiree pension income.
“After two weeks of taxpayer-paid paid vacation, it’s time for the Legislature to get back to Lansing and start working together to move Michigan forward,” said Erin Knott, deputy director, Michigan Citizen Action. “Instead of forcing ordinary families who have already sacrificed to accept higher taxes, Gov. Snyder and the Legislature should require CEOs to share in the sacrifice to balance the budget and get the economy moving again.”
At the Michigan Municipal League’s Conference on the Budget on Tuesday, House Fiscal Agency Director Mitch Bean said, “There is no guarantee that Gov. Rick Snyder’s tax plan would translate into job increases.” Bean went on to say, “The idea that somehow this business tax would automatically create jobs in Michigan is nonsense.” [MIRS, 4/6/11]
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