Tri-City Sun

State Representative Bill G. Schuette has voted to reverse a previous income tax increase implemented by Democrats, aiming to provide relief for Michigan's workers and families.

Schuette highlighted the financial struggles faced by Michiganders, stating, “Michiganders are struggling to pay grocery bills, fill up their gas tanks, cover their mortgages or rent for the month and keep up with rising childcare costs.” He emphasized that the Legislature should prioritize returning money to taxpayers as a means of alleviating these burdens. "This plan is a critical step in that process," he added.

House Bill 4170 proposes lowering the state income tax rate to 4.05% effective January 1, 2025. This change would allow Michigan taxpayers to retain over $700 million annually. The reduction follows an automatic decrease triggered by substantial state revenue growth exceeding inflation rates, which lowered the rate from 4.25% to 4.05%. However, Attorney General Dana Nessel had previously stated that this reduction was temporary, while Governor Gretchen Whitmer maintained the higher rate for budgetary reasons.

The bill aims to reinforce a 2015 law designed to trigger automatic reductions in income tax rates and prevent future administrations from reversing permanent tax relief measures—a situation that occurred under the Whitmer administration in 2024. Schuette remarked on this issue: “Unfortunately, the lower income tax rate was wrongfully erased through fiscal finagling and nickel and diming people like us in Midland and Gladwin counties.”

Earlier this year, budget experts projected an additional $850 million in revenue for Michigan beyond initial estimates—an amount sufficient to support the proposed tax cut.

Having passed the House with bipartisan support, HB 4170 now moves forward to the Senate for further consideration.