SE Grand Rapids News

Speaker Pro Tem Rachelle Smit has voted in favor of a new state budget deal that she says will bring tax relief and reduce the size of Michigan’s government. The budget includes measures to eliminate taxes on tips, overtime pay, and Social Security income as part of President Trump’s “No tax on tips, overtime, or Social Security income” plan.

“So many people in our communities have been tightening their own budgets while the state government has done nothing but grow,” said Smit, R-Martin. “That’s why I’m proud to support a budget that allows our middle-class workers to keep more of their hard-earned income, ensuring those dollars go towards the things that matter and aren’t blown on wasteful government projects. Our plan also slashes other problematic government spending, leading the first reduction in overall spending in a very long time.”

According to Smit, this budget will provide relief for over 500,000 residents by removing taxes from tips, overtime pay, and Social Security income. She states that these changes are intended to help workers and seniors manage rising living costs.

The agreement also addresses inefficiencies within state agencies by eliminating 2,000 so-called ghost employees—positions that were requested but never filled—which freed up hundreds of millions of dollars for other statewide priorities.

Smit noted that under Governor Whitmer's administration, state spending had increased by 43%, with some departments doubling in size. She stated House Republicans reduced the general fund by $800 million this year to curb further growth in government spending.