A broad coalition of organizations, including CMF, the Michigan League for Public Policy (MLPP) and Michigan Nonprofit Association (MNA) have expressed support for increasing Michigan’s Earned Income Tax Credit (EITC).

When it was first introduced the tax credit was at 20 percent; it was reduced to 6 percent in 2010.

Earlier this year, Governor Gretchen Whitmer shared in her state budget proposal that she recommends doubling our EITC from 6 to 12 percent to offset the impact of the proposed fuel tax.

Michigan is one of 29 states that has adopted statewide versions of the federal EITC. Those who qualify can claim from their state taxes a percentage of their federal EITC.

Data at a glance:

• In 2017, more than 748,500 Michigan households received the EITC.

• In 2017 that translated into an average credit of $150, infusing more than $112 million back into Michigan’s economy.

• A recent study from Michigan State University found that doubling the EITC would increase the average rural filer’s application by more than $130.

At a press conference last week several organizations called on lawmakers to support the governor’s proposal.

“The EITC has a significant one-two punch for the households that receive it, and not only improves economic security, but other outcomes, as well, with kids in families that receive the EITC seeing improvements in nutrition and educational and economic attainment,” Gilda Jacobs, president and CEO of MLPP said at the event. “Now we need action to restore the state credit itself, and we urge lawmakers to work with the governor to restore our state EITC, better support Michigan’s struggling families, and unleash more of the credit’s purchasing power in local communities around the state.”

The MLPP has advocated for years to increase the EITC. Most recently, it was a recommendation in MLPP’s 2019 Kids Count in Michigan Databook, calling for an expansion of the EITC to allow young workers and adults without children to receive the credit.

In 2015, CMF supported a ballot proposal which would have increased our state’s sales tax and thereby restored Michigan’s EITC to its original 20 percent level of the federal EITC. While that did not pass, CMF joins organizations around the state in supporting an increase of the EITC to enhance support for Michigan’s working families.  

Whitmer has proposed increasing the EITC over the course of two years, increasing from 6 to 10 percent in the first year and then to 12 percent in year two.

Lawmakers have until October 1 to deliberate and finalize the governor’s state budget proposal.