Michigan tax plan could be immune from voter backlash

Michigan Governor Rick Snyder’s plan to cut taxes on businesses while simultaneously raising taxes on residents – for instance in pension plans – contains a $100 appropriation that would free it from repeal by public vote. This is because of the state constitution, upheld by the Supreme Court, which states that any law which contains as little as $1 of expenditure is free from referendums.

The 183 page tax overhaul bill would replace the Michigan Business Tax with a flat 6% corporate tax rate, while also slashing tax exemptions across the board. These include exemptions for pension plans, the Earned Income Tax Credit for low income workers, and the recently-hyped refundable tax credit for movies produced in within the state.

Michigan Democrats have sworn to challenge the law, on grounds that the appropriations in the bill are designed to usurp the democratic process and take the future of Michigan out of the hands of the state citizens.

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