2014-03-06 / News

MLPP: Tax rollback bad

League claims move would benefit rich

LANSING – The Michigan League for Public Policy recently served up an important message to lawmakers: An income tax rollback will help those at the very top who have already benefited from the economic recovery while leaving the rest of their constituents behind.

An analysis by the League using data from the Washington, D.C.-based Institute on Taxation and Economic Policy finds that a rollback would mean:

• Those at the bottom, the lowest 20 percent of income earners (those earning an average of $10,600), would get just an average of $12, or about enough to buy a cherry pie.

• Those in the middle 20 percent (earning an average of $45,700) would see an average of $88, allowing the purchase of a used dough mixer.

• Those at the very top, the one percent (earning an average of $971,600), would receive an average $2,618 back. That’s enough for a trip for two to Paris to enjoy French pastry in a cafĂ©.

“This is a sweet deal for those who are already enjoying the benefits of an economic recovery. For the rest – it’s the pits,’’ said League President & CEO Gilda Z. Jacobs.

Along with the analysis, lawmakers were given a slice of cherry pie to emphasize that most constituents are getting a small slice of the income tax rollback.

Proposals that would drop the income tax from 4.25 percent to 3.9 percent do not appear to resonate with voters, even in an election year.

“Polling shows that most in Michigan agree that we need to invest in our schools and in our roads rather than an across-theboard tax rollback that will benefit those at the very top the most while starving education, local public services and other investments needed to grow the economy,’’ said Policy Director Karen Holcomb- Merrill.

For more information, see the League’s fact sheet, “Slicing Up the Proposed Income Tax Cut, and policy brief, Tax Cuts Won’t Grow the Economy”.

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