Snyder wants to keep US tax changes from hiking state taxes

LANSING, Mich. (AP) — Gov. Rick Snyder said Thursday that the federal tax bill will cause Michigan residents’ state income taxes to increase, and he is committed to ensuring that taxpayers ultimately do not have to pay more.

The tax legislation, which President Donald Trump is expected to sign, will eliminate the $4,050 personal exemption. That is an issue because Michigan lets people claim a $4,000 exemption for each exemption taken on their federal return.

“The federal tax reform is going to cause people’s Michigan taxes to go up. We shouldn’t take the benefit of that at the state level,” the Republican governor told The Associated Press in a phone interview. “We should figure out how to give that back to the hard-working taxpayers.”

Snyder said while the “very complicated” federal tax bill may have other implications for the state tax code, the elimination of the personal exemption is “the biggest element by far.”

A single person would see a $170 state income tax hike; a married couple with two children would owe $680 more.

Snyder said the simplest fix is boosting Michigan’s personal exemption, but other options are being studied. He plans to propose recommendations in concert with the next revenue-estimating meeting in mid-January, when his administration and legislative economists will agree to budget figures.

Snyder, who first addressed the problem in an interview with Gongwer News Service earlier this week, told the AP he opposes the federal tax bill.

“The benchmarks I’ve always had are it needs to be simple, fair and efficient in a fiscally responsible way. What they passed doesn’t meet that standard in multiple aspects. … Is it simple? It’s not.”

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s

3 comments

  • Bob

    The tax code at both the state and federal level will never be simple. Too many special interest groups and legislators get special treatment in the tax code.

  • Common cents

    Anyone who doesn’t want their tax break can continue to pay their old higher amount to the federal government and request it be paid on Obama’s 10 trillion deficit he left us with.