Michigan State Tax Revenue Estimate Reduced After Brutal WinterChris Christoff
Michigan will collect $616 million less in taxes through 2015 than predicted four months ago, due in part to a severe winter that damped commercial activity, state economists said.
Weaker income, business and sales taxes pushed down the revenue estimate to $20.8 billion from $21.1 billion projected in January. Still, revenue will increase through 2016, according to economists from the administration, House and Senate. Michigan’s 7.4 percent unemployment rate in April was the lowest since April 2008.
State lawmakers and Republican Governor Rick Snyder will have $317 million less than planned to craft a budget for the fiscal year that begins October 1. The reduced projections will cut but not eliminate a surplus calculated in January.
Over three years, the state will collect $986.5 million less than the January forecast. The economists from the various branches meet twice a year to agree on revenue figures.
“The governor’s budget will have to be revised down some, but we’re very excited the economy is growing and that we’ll have more money to invest in 2014,” said Budget Director John Roberts.