Advocacy News – Feb. 12, 2026
What’s new: Gov. Whitmer presented her Fiscal Year 2027 budget recommendation to a joint session of the House and Senate Appropriations committees Feb. 11. The proposal totals $88.1billion – approximately $7.1 billion more than the current year’s budget.
Why it matters: The executive budget serves as the administration’s fiscal blueprint, outlining spending priorities and policy direction for the coming year.
This proposal contains several new or increased taxes, a withdrawal from the state’s Budget Stabilization (“rainy day”) Fund and expanded investments in education and infrastructure.
- The Michigan Chamber will continue to advocate for fiscal discipline and structurally balanced budgets that protect Michigan’s competitiveness. Imposing industry-specific taxes to fund unrelated programs is a practice we have consistently opposed. For example, we will continue opposing a digital advertising tax, because it undermines our business climate and ultimately increases cost for consumers.
Notably missing: Going PRO Talent Fund. The Governor’s proposal did not include funding for the highly successful state grant program that helps employers upskill and train current or new workers. Demand for this program continues to exceed available resources The MI Chamber will advocate for restoring funding of $50 million to meet needs.
By the numbers: Major components of the proposal include:
- New or Increased Revenue
- Digital advertising tax: forecast to generate $282 million
- Landfill tipping fee increase: $80 million in new revenue through an increase in the tipping fee for state landfills – moving the surcharge from 36 cents to $5 per ton – a 1,288% increase. This added fee represents a tremendous burden to multiple industries and could increase the cost of trash pickup for Michigan households and businesses.
- Tobacco tax: forecast to generate $232 million
- Internet casino tax rate increase: forecast to generate $135.5 million
- Vape tax: forecast to generate $95 million
- Per-wager sports betting tax: forecast to generate $38.8 million
- Elimination of free play deduction (internet gaming): eliminating this deduction is forecast to generate $21.1 million
- Tax Relief for Individuals
- Providing property tax relief to approx. 335,000 seniors
- Establishing a “back-to-school” sales tax holiday
- Continuing the Working Families Tax Credit
- Continuing tax exemptions on tips, overtime and social security
- Rainy Day Fund Withdrawal
- $400 million from the state’s approx. $2.2 billion Budget Stabilization Fund.
- Education Investment
- $627 million to improve student literacy, including increasing the per pupil foundation allowance, literacy coaches, curriculum support and teacher training.
Keep in mind: The Legislature and Governor must enact a balanced budget by July 1. Last year, that deadline was missed, bringing the state to the brink of a shutdown and requiring an unprecedented one-week stopgap measure.
That’s not a path Michigan should repeat. Temporary funding measures create uncertainty and instability for employers, local governments and taxpayers. Michigan benefits from timely, predictable budgeting that strengthens economic confidence. The Chamber will work with lawmakers to ensure a responsible, balanced budget enacted on time.
What’s next: Legislative appropriations committees will now review the Governor’s proposal and develop their own budget plans. The Chamber will remain highly engaged throughout the process, advocating for items that advance a growing economy and stronger Michigan for all, including:
- Sustainable spending
- Competitive tax policy
- Workforce investment
- A stable, pro-growth fiscal framework
Go deeper: View the Governor’s budget recommendations and associated documents.
For any specific budget questions or feedback, please reach out to Dan Papineau.