LANSING – While Michigan House Democrats introduced a corporate income tax increase and fee for heavy trucks to generate roughly $1 billion toward roads, they are still willing to support a fuel tax increase like Governor Gretchen Whitmer has been pushing, Minority Leader Christine Greig said Friday.
“I definitely want to stress these are additional ideas to bring to the discussion,” Greig (D-Farmington Hills) said. “We absolutely agree we need new revenue and we need ($2.5 billion), so here are some other sources.”
When Democrats unveiled their plan in a Thursday evening news release, they were noncommittal about Whitmer’s 45-cent per gallon fuel tax increase and touted their plans as raising money for roads “without costing everyday Michiganders more.” However, they also praised Whitmer for offering a bold plan and said they agreed on the overall funding need.
Later Thursday night and Friday, House Democrats clarified they are not rejecting Whitmer’s plan, but offering additional ideas.
The $1.2 billion plan introduced by House Democrats would raise the corporate income tax by 2.5 percentage points to 8.5 percent, implement a flow-through parity tax of 4.25 percent and repeal the pension tax. Further the plan would charge heavy trucks – 26,000 pounds or more – 6 cents per mile for each mile traveled and create a Rhode Island-style bridge roll program for trucks. Rhode Island has begun tolling heavy trucks to help pay for the reconstruction of bridges.
The bills, which were submitted Thursday for introduction but were not officially read in, would also create a Fixing Michigan Roads Fund, where the added revenue from the Corporate Income Tax and vehicle miles traveled revenue from heavy trucks would be directed.
Greig said legislative Republicans, particularly in the House, have said funding can be found for road without new revenue. Greig said that is not the case.
She said with an increased tax on businesses and heavy trucks, everyone would have buy-in toward a long-term solution. Greig said she told some business folks about the proposal, and while she did not get support, she didn’t get completely shot down on the idea.
“It is another aspect we have to talk about,” she said. “If we are really going to come together and come up with a bipartisan solution, we need everyone to come to the table.”
Brian Calley, president of the Small Business Association of Michigan, took to Twitter to say the plan “calls for a 42 percent tax increase on bigger businesses and a 100% increase on small businesses. I guess (House Democrats are) trying to solve the talent shortage reducing the demand for employees and killing jobs.”
While the plan does not include a fuel tax increase, Greig said House Democrats would be open to voting for one. She said additional revenue is needed for roads, but Republicans have scoffed at the gas tax increase, particularly at the 45-cents Whitmer proposed.
Greig said the plan presented by House Democrats gets to half of the need, and the other half could potentially be found through a fuel tax increase. Or other ideas could be brought to the table.
As negotiations continue on the budget and road funding, which Greig is also a part of, there will be more ideas to discuss, she said.
“I think it is bolstering (the governor’s) idea that we need $2.5 billion,” Greig said. “All we have heard from Republicans is they think there is existing revenue in our state budget.”
This story was published by Gongwer News Service.