LANSING – A day after Senate Republicans tried to advance a budget-slashing plan that would eliminate hundreds
of jobs and gut funding to public safety and schools, State Representative
Bob Constan (D-Dearborn Heights) and the Michigan House introduced
a key budget proposal Monday to save the state $500 million by ending tax loopholes. The plan is part of House
Democrats' comprehensive strategy to resolve the state's unprecedented fiscal crisis through cuts, reforms and
revenues.
"Solving our state's $1.75 billion fiscal crisis requires an aggressive, comprehensive approach that includes cuts, reforms and revenues, and one area in great need of reform is the billions of dollars in special interest tax breaks written into our tax code," Constan said. "Eliminating tax loopholes that benefit corporations and special interests is a key component to moving Michigan forward."
The plan will save taxpayers $500 million annually. Currently in Michigan, telecom companies receive tax breaks that add up to about $37 million a year. Michigan gives a break to oil and gas companies that amounts to $3.9 million annually. Tobacco wholesalers are allowed to write off their bad debts to the tune of $800,000 each year.
"Many of Michigan's tax exemptions were created with worthy public policy goals in mind, such as jumpstarting our state's economy and creating jobs," Constan said. "As the state of Michigan struggles during these challenging economic times, this plan eliminates many tax exemptions that do not benefit state residents. Each time a new tax break is added to the tax code, a select special interest group gets preferential treatment. Michigan can lo longer afford to do that.