Income tax projected to drop to 4.05% this year at a cost of roughly $600M

Michigan's income tax rate may automatically drop from 4.25% to 4.05% this year if final year-end revenues come in as projected, based on information discussed Friday by state economists. Such a scenario would cost the state budget $600 million a year with the possibility of the income tax rate dropping further in future years. The tax year 2023 is the first year of a trigger within the 2015 gas tax hike bill that permanently reduces the income tax if annual General Fund revenues is 40% higher than FY ‘21 General Fund revenues after inflation. Hypothetically, if the trigger were activated

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