by Scott McClallen
The Michigan Senate approved a bill aiming to speed up the earned income tax credit refund to low-wage workers from 2024 to this year.
Senate Bill 144 passed on a vote of 27-10 in the Democrat-dominated Senate.
The EITC is a tax credit for low-income workers and families.
Earlier this year, lawmakers more than tripled the EITC through House Bill 4001, but the change wasn’t effective until the 2024 tax year because Republicans withheld votes to guard an income tax break. This bill aims to expedite the tax refunds.
Assuming the bill received immediate effect, the bill would shift about $441.6 million of revenue loss estimated from fiscal year 2023-24 into fiscal year 2022-23.
Sen. Kristen McDonald Rivet, D- Bay City, said the credit would help more than 1 million children.
“The money is already allocated inside the legislation we have already passed and the governor has signed,” Rivet said in a floor speech. “So essentially, this allows those dollars to be released right now when families are struggling to pay for milk and cereal and bread when many of the families that qualify for this tax credit have recently lost supplemental food benefits, they have lost housing assistance and are concerned about redetermination of their health care.”
The bill gained bipartisan support.
Sen. Joe Bellino, R-Monroe, voted for the package but blamed the delay on “political gamesmanship” – what he said was Democrats tacking the proposal onto a corporate welfare bill to avoid an income tax cut.
“I will vote yes on the EITC but the majority’s political scheming and dysfunction are having a real-world impact on the working poor,” Bellino said on the floor. “Low-income Michiganders have seen lots of press releases, lots of press conferences, and tweets coming from all over the place. But one thing still hasn’t been seen: more money in their pocket.”
SB 144 moves to the Democrat-controlled House.
The bill would amend the Income Tax Act to specify that a taxpayer who claimed the earned income tax credit for the 2022 tax year would be entitled to a credit equal to 24% of the Federal EITC.
– – –
Scott McClallen is a staff writer covering Michigan and Minnesota for The Center Square. A graduate of Hillsdale College, his work has appeared on Forbes.com and FEE.org. Previously, he worked as a financial analyst at Pepsi.
Photo “Michigan State Capitol” by jasongillman.
