Waterford Today

State Representative Mike Harris has supported a legislative measure aimed at reducing the state income tax rate for Michigan residents and small businesses. The proposal, encapsulated in House Bill 4170, seeks to lower the tax rate to 4.05% starting January 1, 2025. This move is intended to reverse a previous tax increase from 2024 and allow taxpayers to retain over $700 million annually.

Harris, representing Waterford, emphasized the need for financial relief amidst rising living costs. "People in Oakland County and across Michigan could use some relief from costs that have skyrocketed over the last few years," he stated. He further criticized the prior tax hike and government spending, arguing that taxpayer money should be utilized effectively for essential services like police, roads, and schools.

The bill also addresses a provision from a 2015 law designed to trigger automatic tax cuts when state revenues surpass inflation rates. This measure aims to prevent future administrations from obstructing permanent tax relief efforts, as was seen with the Whitmer administration's actions in 2024.

Previously, an automatic reduction in 2023 had temporarily lowered the rate from 4.25% to 4.05%, but it was later deemed temporary by state officials, resulting in a return to the higher rate on January 1, 2024.

Harris assured that Michigan's current revenue levels are sufficient to support this proposed tax cut. Budget analysts recently reported an unexpected surplus of $850 million for the state, which exceeds what is necessary to fund the reduction approved by the House.

House Bill 4170 will now proceed to the Senate for further deliberation.