Advocacy News – Aug. 1, 2025
What’s new: The Board of State Canvassers deadlocked over a 100-word for summary for the graduated income tax constitutional amendment yesterday, yet the Board approved the petition form. Proponents are expected to begin the signature gathering process in lieu of going to court.
Why it matters: The proposed amendment would change Michigan’s longstanding flat income tax, doubling the rate of those with income over $500,000 (single filers) and $1 million (joint filers). The impact on small and mid-sized businesses would be devasting as most of the impacted taxpayers (2/3rd or more) are pass-through entities (like LLCs, partnerships and S corps) where income is taxed at the individual level – meaning this change would hit these job providers directly.
- The 2-2 vote by the Board reflects the reality that the 100-word description fails to capture the broad impact of the proposal — including steep tax hikes on many small and mid-sized businesses and a significant shift in Michigan’s tax structure that’s been prohibited by Michigan’s Constitution since its inception.
What we’re saying: The Michigan Chamber has consistently raised concerns that proponents are trying to downplay of the impact of this proposal, especially small and mid-sized businesses – the job creators who drive growth and provide economic opportunity and the products and services we rely on in communities across our state. If adopted, Michigan’s top income tax rate would become the 7th highest nationally and highest in the Midwest, further crippling the state’s competitiveness.
- We urge voters to get the facts and decline to sign this highly misleading ballot petition and beware of the unintended consequences.
What’s next: Proponents need to gather 446,198 signatures within 180 days to qualify for the ballot. The Chamber will be laser focused on helping voters understand the full scope and sweeping impact of this proposal before it goes to the ballot.
Go deeper: Read the full proposal or contact Randy Gross with questions.