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Snyder’s Proposed Elimination of Michigan EITC Ignores Key Item on Dashboard

February 17, 2011

Gov. Snyder’s proposal to eliminate Michigan’s tax credit for the working poor, the Earned Income Tax Credit, will push 14,000 Michigan children into poverty and lead to poor families in Michigan having an even higher tax burden than wealthy families.

“We are disappointed that Gov. Snyder is ignoring one of the key items on his dashboard – children in poverty,” said Gilda Jacobs, president and CEO of the Michigan League for Human Services. “The states with the highest child poverty rates have no EITC. Ending the EITC also jeopardizes his call for a P-20 education system, since cutting support for low-income families will only reduce the opportunities for their children to be ready for school.”

Jacobs also noted that ending the EITC will increase the regressivity of Michigan’s overall state and local tax system. “We know that low-income families in Michigan pay a far higher percentage of their income in sales and property taxes than do wealthy families. The EITC helps balance that somewhat. The governor’s proposal will mean low-income families will be carrying a much larger share of the state’s tax burden.”

Jacobs is helping coordinate a large group of organizations opposed to elimination of the ETIC.

“We all hope that the Legislature will reflect on this issue carefully, and realize that the EITC has long-term value for Michigan,” she said.

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