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Tue July 9, 2013
State Lawmaker Introduces Plan To Throw Out State Income Tax
There’s a proposal in Lansing to throw out the state’s income tax.
As The Michigan Public Radio Network’s Jake Neher reports, the bill would let voters decide whether to keep the tax or get rid of it.
Republican state Representative Bob Genetski says he’s heard “a lot” of complaints from his constituents about having to pay state income taxes. That’s especially since the state stopped exempting pensions from the tax last year.
Genetski’s bill doesn’t include a specific plan to replace the lost revenue. But he says he has an idea.
“I personally favor going more toward a consumption tax, which would obviously lead to a higher sales tax,” he says.
Genetski says people should have to pay taxes on what they spend, not on what they earn.
Former director of the state House Fiscal Agency Mitch Bean says the plan would leave an eight-and-a-half billion dollar hole in next year’s state budget. He says the sales tax rate would have to be at least doubled to make up for the lost revenue.