Governor Snyder on taxing low-income workers more

Jan 28, 2011

Governor Rick Snyder has not yet said whether he’ll support efforts to increase state taxes on the lowest-earning workers in Michigan.  He has indicated he’ll have something to say about whether to eliminate the Michigan Earned Income Tax Credit when he gives his budget address.

“Well, we’ll save that for mid-February.  But the Earned Income Credit is largely a federal program.  That’s the main driver that brings results, is the fact that it’s on your federal return.  It’s a question of how much difference does the Michigan piece of that make in terms of changing behavior.”

The Michigan piece is a refundable tax credit that equals 20-percent of the federal tax credit.  Last year, the average low-income worker got $400 because of the tax credit from Michigan.  Republicans in the House have said the state can no longer afford the credit.