(The Center Square) – Gov. Gretchen Whitmer called for “immediate” relief to some Michiganders from rising prices in her State of the State address Wednesday evening.
Whitmer, the Democrat who won a second term in November, said three proposals will make a “real difference” to many residents who are “facing the pinch right now” at the grocery store and with medical bills and prescription costs.
Speaking to lawmakers in the Senate and House, where Democrats hold the majority in each, she proposed:
• To roll back the retirement tax, a move she says will save 500,000 households $1,000 a year.
• To expand the earned income tax credit from 6% to the federal mark of 30%, thus providing at least $3,000 refunds to 700,000 families.
• To offer cost-free pre-kindergarten for 4-year-olds, a move she says will save families of those children an average of $10,000 a year.
“Seniors who served, saved, and did everything right deserve to keep more of what they earned,” Whitmer said.
The retirement tax rollback plan aims to drop taxes on retirement income by about $500 million a year once it’s fully implemented in the 2026-27 tax year, according to the nonpartisan Senate Fiscal Agency analysis of Senate Bill 1.
“With inflation, every dollar saved makes a difference,” Whitmer said. "That’s why we’re moving fast.”
Whitmer wants to lower the age from 25 to 21 for her Michigan Reconnect Program. The initiative offers those 25 and older a tuition-free associate’s degree or skills training.
Whitmer said the policies will make the state more competitive. Michigan lost more than 3,000 residents in the last year, according to census data.
Whitmer touted economic development tools that helped subsidize electric vehicle production last year. The $2 billion is in investments like LG Energy Solutions and General Motors.
“Let’s keep bringing supply chains of cars and chips home," Whitmer said. “And let’s increase domestic clean energy production, like wind and solar, so we can produce more energy in America instead of overseas.”
Whitmer also promised to "fix the damn roads."
Foiled often by Republican majorities in the Legislature during her first four years, Whitmer is expected to accomplish multiple policy goals while the Democratic trifecta is in place.
House Republican Minority Leader Matt Hall, R-Richland Township, called for lawmakers to provide “immediate, fair tax relief.”
“First and foremost, Michiganders need relief during these difficult economic times that are defined by a rising cost of living,” Hall said in a post-speech statement. “They need the governor to work for immediate, fair tax relief – plans Republicans have put forward. Democrats may be starting to come around to our ideas to provide immediate relief for Michigan workers and fair, timely relief for seniors, and the governor should help us make this relief a reality.”
Sen. John Cherry, D-Flint, welcomed Whitmer's proposals.
“Tonight was not about what Democrats want for Michigan," Cherry said in a statement. "Rather, the priorities laid out tonight benefit Michiganders across the state and, finally, we are in a position to deliver results for residents."