Michigan House passes income tax cut
The bill passed 65 to 43, with 2 not voting.
The current income tax rate is 4.25%, but the bill would lower it to 4.05% as of Jan. 1, 2025.
In addition to lowering the tax rate, the bill also addresses a 2015 law that the says was intended to automatically—and permanently—cut taxes when state revenue exceeds inflation. In 2023, the law went into effect, lowering the tax rate from 4.25% to 4.05%.
However, that the cut was temporary, and the tax rate went back to 4.25% in 2024.
Proponents of the bill say HB-4170 will prevent future reductions from being rolled back unless the state legislature explicitly changes them.
State Rep. Kathy Schmaltz (R-Jackson) says the state has $850 million in surplus revenue—more than enough to cover the cost of the tax cut, which sits at an estimated $700 million.
The bill now moves to the Senate for further consideration. 6 News will keep you updated on further developments.
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