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Rollback Individual Income Tax Rate to 4.05 Percent and Ensure It Stays Permanent (HB4170)

Score:

0

%

Michigan

2026

Latest Action:

REFERRED TO COMMITTEE ON FINANCE, INSURANCE, AND CONSUMER PROTECTION

Updated:

March 20, 2025

Chamber:

Senate

This bill would lower Michigan’s individual income tax rate from 4.25% to 4.05% starting in 2025 and establish 4.05% as the permanent base rate moving forward. The rate could be reduced further in future years if state revenues grow faster than inflation, but it could not increase above 4.05% under this bill. The changes apply to individuals, partnerships, estates, and trusts, updating the Michigan Income Tax Act accordingly. In addition, the bill adjusts how much income tax revenue is allocated to the State School Aid Fund, providing for small annual increases in the portion deposited through 2026 and beyond.

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