Tax cuts will likely be a main topic for the Michigan Legislature when lawmakers return to Lansing this week from their summer break.
The state Senate is scheduled to take attendance and hold votes on Tuesday for the first time since the early morning hours of July 1.
Republican leadership says there’s still a lot it hopes to accomplish before election day and the end of the year.
“We hope to finalize a package of bills to improve our foster care system, as well as the Majority Leader’s bill to fix our broken mental health system. And we’ll continue to push for sending money back to Michiganders struggling with record-high inflation,” said Matt Sweeney, a spokesperson for Senate Majority Leader Mike Shirkey (R-Clarklake).
House Republicans say they’d also like to see income tax rates cut. That’s despite Governor Gretchen Whitmer already vetoing multiple bills to do so this session.
Representative Pamela Hornberger (R-Chesterfield) said there’s still time to get legislation through — even with an election approaching.
“Taxpayers are still out there waiting for some relief as their grocery bills climb higher and higher and just the cost of living, the cost of doing anything with your family, whether it’s signing your kid up for a class or tutoring, everything’s more expensive,” Hornberger said Friday.
Democrats are questioning whether cutting income taxes would do families immediate good. Instead, minority leadership is supporting Whitmer’s plan to send residents $500 tax rebate checks.
“When we finished our work last June 30 and we completed the budget, we left over $7 billion on the balance sheet unallocated. We can do this without raising taxes for any Michigander,” House Minority Leader Donna Lasinski (D-Scio Township) said.
She said Democrats are focused on repealing Michigan’s 1931 abortion ban — the enforcement of which is currently blocked by a court injunction — and the state's pension tax. They’d also like to see the earned income tax credit expanded.
In the final session day before going on break, Democrats tried unsuccessfully to advance legislation repealing the abortion ban. It’s unlikely the Republican legislative majority will budge despite vowed persistence from Democrats.
It seems there could be some wiggle room, however, when it comes to taxes on retirees and expanding the EITC, which proponents describe as a tax break for working families. The most recently vetoed income tax cut bill would have expanded it by 14%.
Meanwhile Hornberger, who serves as speaker pro tempore in the House, said Republicans are open to a pension tax repeal.
“Although everybody talks about it, it never seems to be a priority that comes to the top, but I think it’s something that we definitely need to look at,” she said.
Outside of tax cuts, there’s the issue of millions in unclaimed federal COVID-19 relief dollars set aside for Michigan. Democrats have spent months urging leadership to take up a vote on bringing in that money.
Now, Lasinski said, lawmakers have until the fiscal year ends on September 30 to act or risk losing them.
“There’s about $100 million that are left there, and we need to get those final votes across. It’s absolutely critical. And so that’s one of those end-of-year items and fiscal year items. We don’t want our taxpayer dollars going to Ohio,” Lasinski said.
Both sides of the aisle say there are multiple bipartisan efforts they hope will advance as well. The lawmakers mentioned lowering the price of insulin and creating more economic development incentives.
Lasinski argued the state is already seeing a sizeable return from existing investments to lure in major projects.
“Right now, we’ve got about $230 million left in our economic development fund and I believe and am hopeful, because those dollars end this September 30, that we are able to take that fund to a place which is closer to where we started, $1 billion,” she said.
Though committee meetings have sporadically taken place since session days technically resumed earlier this month, the House will likely hold its first day back voting on Wednesday.