Whitmer Vetoes Gas Tax, Income Tax Cuts; Suggests Pausing Sales Tax On Gas

Gov. Gretchen Whitmer vetoed both the $2.5 billion income tax cut and the $750 million gas tax pause Friday afternoon, writing in her letter that she wants to work with Republicans on tax relief as part of a general budget discussion that include a pause on collecting sales tax on gasoline.

Whitmer wrote that lowering the income tax from 4.25% to 3.9% will “blow a recurring, multi-billion-dollar hole in basic state government functions from public safety to potholes.”

She said it would force future tax hikes to make up for the lost revenue down the line, which is why business, education, public safety and mayors across the state urged her to veto SB 768.

The Governor may be referring to more than 20 letters obtained by The Metro Times representing more than 85 organizations that urged Whitmer to reject the tax plan to prevent a “massive deficit” that would jeopardize federal aid from the American Rescue Plan.

The Sen. Aric  Nesbitt (R-Lawton) bill also gave families a $500-per-child tax credit and shielded more retirement income from taxation.

“People in every part of Michigan are struggling more and more to keep up with daily expenses and record inflation that hasn’t been experienced in more than 40 years — Friday the Governor told them, ‘Tough luck, you’re on your own,” Nesbitt said.

As far as the six-month gas tax pause in HB 5570, the Governor said since the bill doesn’t go into effect until 2023, the “misguided proposal does nothing for Michiganders facing pain at the pump right now. In fact, it would kill 35,000 construction jobs, handicapping our ongoing work to fix roads and bridges as construction season ramps up and we are all focused on getting Michiganders back to work.”

Whitmer said she wants to sit down with Republicans and hammer out “real relief” not “lip service.”

She is partial to expanding the Earned Income Tax Credit and exempting retirement income from taxation. The vetoes came an hour after she called on temporarily pausing the state sales tax on gasoline.

She said a short-term pause is a fiscally responsible action that will help provide drivers relief at the pump right now — not next year.

Senate Majority Leader Mike Shirkey (R-Clarklake) said Whitmer is telling Michiganders with this veto that she knows how to spend taxpayers’ money better than they do.

On the Governor’s suggested pause on collecting sales tax on gasoline, Shirkey said:

“The governor isn’t just a day late and a dollar short on this issue, she’s weeks late and millions of dollars short. Other than writing a letter to Nancy PELOSI, she’s been absent as Michiganders are struggling with record-high gas prices. Now she’s proposing a half-measure that won’t save drivers as much as the bill we’ve already passed.

“If the governor really wants to help Michiganders, she’ll tell Senate Democrats to support immediately suspending the gas tax. Then we can talk about doing away with the sales tax on gas once and for all.”

The groups People First Economy and Prosperity Michigan cut a press release stating that the Governor was right to veto a “short-sighted giveaway” that was put on the table as an election year gimmick.

Whitmer also vetoed Sen. Lana Theis (R-Brighton)’s SB 11, which requires county clerks to issue concealed pistol licenses during declared emergencies. She said mandating this activity without regard to the scope or gravity of the emergency would jeopardize Michigan clerks.

She also said that prioritizing the concealed pistol permits during an emergency would be a “poor use of resources.”

Theis said Friday was a “disappointing day for gun owners.” Theis said she wasn’t surprised by the move since “she has never supported gun owners and she likely never will.”

“The Second Amendment is clear that the rights of law-abiding citizens to keep and bear arms shall not be infringed, but that is exactly what Gov. Gretchen Whitmer did today.”