Chamber Blog

Governor Whitmer Presents First Budget

Governor Whitmer Presents First Budget

Governor Whitmer presented her first budget proposal to the legislature on March 5, addressing roads, talent, and business taxes. The Chamber looks forward to adding a West Michigan business voice to discussions with the Administration and the Legislature to find a solution that promotes a prosperous Michigan for all.

Check out the highlights of Governor Whitmer’s budget proposal below:

Gas Tax

Receiving the most focus, the Governor proposed a $2.5 billion increase in road funding by raising the gas tax 45-cents-per-gallon tax in three increments by October 1, 2020. The money raised from the gas tax will go into the new Fixing Michigan Roads Fund and will be allocated to the most highly traveled and commercially important roads. Click here to see the Fixing Michigan Roads Plan distributed by the State Budget Office.

The plan will also divert $600 million of General Fund dollars that were committed in the 2015 transportation funding package for other Administration priorities, such as higher-ed. The Chamber will work with our Transportation Committee to determine our position on the various details of this proposal.

Small Business Tax

The Governor proposed a tax increase on pass-through businesses from the current 4.25% to 6%. Revenue from this increase would go to support the repeal of the tax on retirement benefits. Partnerships, LLCs, and S-Corporations are taxed at the individual rate of 4.25%, and C-Corps are taxed at 6%. This proposal would have all businesses at the 6% level, and provide a credit to Partnerships, LLCs, and S-Corporations to prevent double taxation. There is a protection for businesses with less than $50,000 income.

This tax goes against the Chamber’s priority of creating a vibrant business climate, and we will be advocating against a tax increase that would place additional burdens on small business. Click here for more information.

MI Reconnect & MI Opportunity Scholarship

To combat Michigan’s talent and skills gap, the Governor has proposed the creation of two programs to increase degree attainment: Michigan Reconnect and MI Opportunity Scholarships.

Michigan Reconnect is a tuition-free program geared towards individuals 25 years old and above. This program would focus on reconnecting displaced individuals back to the workforce through degree attainment, certificates or credentials.

MI Opportunity Scholarships is a two-pronged program focused on students graduating from our K-12 system that want to go on to a two-year or four-year institution. Part of the scholarship would be towards debt-free community college. Students could earn 60 credits for up to three years with the goal of getting a technical certification or associate degree, or transferring to a four-year university. The other portion of the program would be $2,500 of tuition assistance for the first two years enrolled in a four-year degree for individuals with a family income of less than $80,000 per year. Click here for more information.

Talent is the top priority for our members and the Chamber is evaluating our position on the specifics of this proposal.

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