GOP's Kevin Rinke wants to end Michigan's income tax; plan for budget cuts comes later
Lansing — Businessman Kevin Rinke, a Republican who's running to be Michigan's next governor, has vowed to eliminate the 4.25% individual income tax by 2024, but he wouldn't specify how he would cut the budget or fund government without the revenue.
Rinke of Bloomfield Township said his proposal would make Michigan more competitive economically and help residents keep more of their own money amid rising prices.
"The best way to alleviate the pain of inflation is to eliminate Michigan’s individual income tax," the candidate said. "It will give families money when they need it most, and force Michigan’s government to do more with less. That’s my vision for Lansing."
The individual income tax produced about $11.9 billion in revenue for Fiscal Year 2021, according to the state Department of Treasury. That number amounts to about 16% of the $74 billion budget plan Democratic Gov. Gretchen Whitmer proposed in February for next year.
Cutting that amount of money from the budget would be a dramatic shift in state government operations and would likely mean funding reductions for schools, road work and other services, if the revenue weren't replaced.
Rinke's plan, announced Wednesday, would involve sending a proposal to the Legislature to eliminate the personal income tax in one of his first acts as governor. The repeal would take effect on Jan. 1, 2024.
A debate would occur on putting in place "a world class funding system that will make Michigan more economically competitive," according to the Rinke plan. His deadline for enacting the new funding system would be May 31, 2023.
Rinke said there are "other tax structures" when asked in an interview what his alternative to the individual income tax would be. He said nine states have no state income tax.
If the Legislature failed to act on eliminating the income tax, Rinke said he would lead an initiative campaign to put the idea before voters.
Under his plan, not all of the revenue from the income tax would be replaced. And, the plan said, additional revenue will be "recovered through economic growth and the attraction of new taxpayers and businesses."
Asked what he would cut from the state budget, Rinke said the Legislature "ultimately will propose those cuts."
"If you notice, it's implemented in 2024," the candidate said. "We've got 12 months to go line by line, entity by entity to make those cuts. And there is plenty of money there."
Right now, government is "acting like drunken sailors," Rinke said.
On whether he would cut funding for schools, he said his administration would take a hard look at how the state spends money on education.
"If we were spending the money that we allocated on the students instead of on programs that are failing and people that are put in positions that are woke, versus providing value in education, we're going to save billions of dollars right there," Rinke said.
Under Rinke’s proposal, the average family of four in Michigan making $75,000 a year would see a projected savings of nearly $2,500 annually, his campaign said.
Rinke is one of 10 Republicans seeking their party's nomination for governor in the August primary. The winner will take on Democratic Gov. Gretchen Whitmer as she seeks a second term in November.
cmauger@detroitnews.com