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Tax Climate

Impose a Graduated Income Tax in Michigan

Staff Contact

Leah Robinson

Director of Legislative Affairs

(517) 371-7669 | lrobinson@michamber.com

Summary of Bill & What It Means to You

SJR C (Irwin):  This joint resolution would eliminate Michigan’s longstanding, fair, flat income tax and replace it with one with a graduated one.  A flat rate income tax is when with one tax rate applying to all incomes.  A graduated income tax rate, also called a progressive tax, is a tax structure that levies increasingly higher tax rates on higher-earning individuals or businesses. Essentially, under this kind of system: the more you make, the more you pay.

Chamber Position

OPPOSE:   A graduated income tax does nothing more than redistribute wealth and punish individuals and job providers for being successful.  It also sends a message to motivated entrepreneurs to find somewhere other than Michigan to start a business, grow, and prosper.  Nothing incentivizes disinvestment and relocation outside of our great state more than taxing hard work and success.

.7% of Michigan taxpayers pay $1 billion in income tax every year while 35% of taxpayers actually get back $245 million just for submitting their income tax forms.  Michigan already ranks high when it comes to income taxes paid per capita AND income taxes paid as a percentage of income.  Why would we want to make the system more imbalanced and worse?

While the detrimental consequences a graduated income tax would have on individuals is apparent, another part of the graduated income tax proposal, as it stands, which is not as obvious but needs to be considered, is its potential to allow for a graduated corporate income tax as well.  After years of unfair and complicated business tax policy in the State, Michigan finally adopted a flat 6% corporate income tax.  36 states have flat corporate income taxes or no corporate taxes at all and at a rate of 6% Michigan is fair and still competitive.

Tax and spend proponents of a graduated income tax are shortsighted and irresponsible.  The Michigan Chamber believes in fiscally prudent tax policy that fosters growth, rewards success, and incentivizes hard work.

Bill Sponsors

This bill is a Job Killer

State Senator Jeff Irwin, District 18

State Senator Jeremy Moss, District 11

State Senator Stephanie Chang, District 1

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Oppose
Impose a Graduated Income Tax in Michigan

SJR C (Irwin):  This joint resolution would eliminate Michigan’s longstanding, fair, flat income tax and replace it with one with a graduated one.  A flat rate income tax is when with one tax rate applying to all incomes.  A graduated income tax rate, also called a progressive tax, is a tax structure that levies increasingly higher tax rates on higher-earning individuals or businesses. Essentially, under this kind of system: the more you make, the more you pay.

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