OUR VIEW: Leave original tax cut date in place

By Daily News • Last Updated 12:45 pm on Monday, June 11, 2012

“The Republican-led Michigan House is set to approve legislation that would move up an income tax cut from January 2013 to October 2012.”

So The Associated Press reported earlier this week. While there are many admirable things about our legislative process (think of the alternatives), political grandstanding is not one of them and this idea speaks directly to nothing more than that.

There is a lot of history to the phased income tax cuts attempted at the state level. In the waning years of the Engler administration it was deemed appropriate to approve a phased decrease on state income tax levels from 4.6 percent to 3.7 percent over a period of 10 years. Michigan’s ever charging economy was the reason and “full employment” was our economic reality. Lots changed: people flew into buildings; Europe became an economic “zone” only to always teeter on dissolution; China and Mexico took our jobs; and people left our state in droves. Gov. Granholm, desperate for a solution, rescinded the tax cut idea out of necessity as fewer people were paying income tax and those that were, at levels less than before because their incomes were less. Years of contentious budget negotiations offered the state’s citizens less and less for their money and we maintain that we aren’t out of the woods yet.

Along come the ladies and gentlemen on the right hand side of the chamber who are up for election every two years and they see a ripe opportunity to score points (and save their hides) with their constituents.

Yet another income tax cut had been scheduled for January of next year (from the current 4.35 percent to 4.25 percent) because of the state’s impending “surplus.” We disagree with the usage of the term “surplus” as it relates to anything for which the state is responsible. Our roads are still a mess and no long term funding solutions yet exist; our education system is breaking at the seams with too many underserved students and not enough funding to instruct them with all of their needs; our prisons are scheduling early releases and laying off staff because the economies of the system just don’t work; our social agencies are looking under every rock for grant funding options because their budgets are stretched to the max.

The proposed tax cut idea would net each taxpayer about 7 cents per day. That 7 cents gained each day for the remaining 92 days of 2012 would add to your bank account a whopping $6.44. As they say, “Don’t spend it all in one place.” We think a better idea for the Republican-led House is to continue to add to that “surplus” for the remainder of the year and leave the original tax cut date when the calendar turns to 2013. We all have seen how fast a “surplus” can evaporate. The only possible reason they want to throw this into effect any earlier is that there is an election coming shortly after the Oct. 1 date and, quite literally, their seats are on the line. They want smiling voters. We trust the taxpayers would think that the $6.44 windfall is better left where it belongs — building back up a state that is still in the process of coming up off the canvas.

Editorial opinions are the consensus of The Daily News editorial board.

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