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Ballot Prop Requires Reduced Taxes For Individuals Making Under $175K

March 3, 2020

A constitutional amendment proposal to require reduced tax rates for anyone making less than $175,000 – or $350,000 for those filing jointly – was filed with the state Bureau of Elections Friday.

The proposal being pushed by a group called Fair Tax Michigan was announced Friday via press release, which said the initiative would “cut taxes for over 90% of hardworking Michiganders while raising $1.5 billion in new revenue by reforming Michigan’s outdated regressive individual income tax system.”

The summary of the petition language states it would “repeal the ban on a graduated income tax” and “require the Legislature or Governor to enact a fair individual income tax in 2021” and require the tax reduction for those making $175,000 or less and joint filers making $350,000 or less.

The amendment summary also calls for producing “$1.5 billion more revenue for schools and infrastructure” and would also “prohibit reduction in state revenue before 2025.”

The proposal would allow the Legislature and Governor to amend the income tax in 2025 and require the Office of the Auditor General (OAG) to audit implementation of the income tax.

“In the last forty years, our schools have crumbled, our roads are nearly unrecognizable and Michigan went from being known as a Water Wonderland to being known for the Flint Water Crisis,” said Eli Isaguirre, campaign manager of Fair Tax Michigan, in a statement. “While the politicians in Lansing argue over what to do, our campaign is offering a solution that is fair for everyone and gets things done for once.”

It’s not immediately known who’s supporting the group, which is also calling itself Michiganders For The Commonwealth in the press release. A ballot proposal committee by the same name was formed Feb. 10 but hasn’t reported any campaign finance filings with contributors and donors since then.

But MIRS reported back in December that some in the progressive community were pushing for the graduated income tax as a way to raise more revenue for Gov. Gretchen Whitmer’s roads plan.

A constitutional amendment would require 425,059 valid signatures collected by July 6 to be placed on the ballot in November.

According to the press release, since 2000, Michigan’s general fund has dropped 30% and per-pupil funding has dropped 22%, and as a percentage of aggregate personal income, Michigan raises $15 billion less annually than in 1972 and $3 billion less than the national average.

Yet the group said not everyone in Michigan has benefited equally from the “tax giveaways that have taken place over the last 40 years.” Families below the poverty line are contributing over 10% of their income to state and local taxes, while the rate for millionaires hovers around just 6%, according to the release.

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