While Gov. Snyder and Lt. Gov. Calley said today we should not pick winners and losers in reforming the state’s tax system, they clearly have broken their own rule.

The executive budget reduces business taxes by $1.8 billion but increases taxes on seniors and families by $1.7 billion.

“We have missed a great opportunity to modernize Michigan’s outdated tax system. Instead, the administration has proposed one that simply shifts taxes from businesses to vulnerable kids, families and seniors,’’ said Michigan League for Human Services President & CEO Gilda Z. Jacobs. “That said, we’re pleased to see that the governor does consider Medicaid, higher education financial aid, community colleges and preschool as areas that do need our protection. At least we can agree on some things.’’

This is not a balanced approach, however, but one that penalizes those who are least able to afford it even as widespread cuts are proposed to programs that help all citizens.

The elimination of the Michigan Earned Income Tax Credit would mean that 782,000 lower-income families will see their taxes rise dramatically. It would also return Michigan to a state that taxes people into poverty and taxes families already living below the poverty line.  Some 14,000 children would be shoved into poverty with the elimination of the EITC.

In addition, the reduction in the state child credit ($600 per child) will mean an even greater  tax burden on families. The executive budget also projects that 10,000 fewer low-income families will receive cash assistance through the Family Independence Program because of stricter time limits.

“We are disappointed and confused. The governor has made reducing child poverty one of his priorities measured in his MiDashboard, yet this budget proposal directly hurts vulnerable kids,’’ Jacobs said.

While Michigan’s exemptions for taxing pensions are overly generous – among the most generous in the country – the plan does not exempt lower-income seniors. Seniors should not pay for business tax cuts. This is a misplaced priority.

“Modernizing the tax system by pausing the income tax rate reduction, enacting a graduated income tax and adding a sales tax on services would have positioned Michigan to solve its structural deficit and provide needed services in the future. We have missed a historic opportunity to do this,’’ said Karen Holcomb-Merrill, director of the League’s state fiscal project.

In addition, steep cuts to revenue sharing will hurt public safety and other vital local services.

“The governor also spoke about not kicking the can down the road,’’ Jacobs said, “but pulling the rug out from under poor kids will do just that.’’

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The Michigan League for Human Services is a nonprofit, nonpartisan statewide policy and advocacy group for low-income citizens. It has a network of 1,500 individuals and organizations from business, labor, human service professions, faith-based organizations as well as concerned citizens.