Now is the time to tackle tax reform at the federal level. If you look at the Internal Revenue Code you’ll find it is confusing, complex and inefficient, even to a nerd like me who isn’t just the governor of Michigan but also a certified public accountant.
It has been more than 30 years since Washington, D.C. passed major tax reform. Since then, the tax code has become a 74,000-page Goliath puzzling American families and businesses. We need reform now to ensure Americans receive much-needed tax relief, provide a boost to our nation’s economic growth and allow millions of workers to keep more of their hard-earned money.
I am proud that Lt. Gov. Brian Calley and I led the way for Michigan to implement successful tax reform in 2011, helping to pave the way for the Michigan comeback. Our state is a role model for the nation on how to do tax reform the right way to ensure economic growth.
It’s encouraging that leaders in Washington, D.C. have released a framework that, if implemented, would move our country in the right direction. The outline calls for a simplification of the tax code and a reduction in the tax burden for many individuals, families, and businesses. This can help states like Michigan accelerate economic growth, attract job creators and further strengthen local economies for our residents. It could help create more homegrown jobs and boost take-home pay for all Michigan workers.
When you do tax reform the right way, like we have done in Michigan, you create an environment of success. In Michigan, we eliminated the job-killing Michigan Business Tax. As a result, we ended decades of double-taxation of small job providers and sole proprietors, paving the way for business growth. In addition, we are phasing out the burdensome business personal property tax on manufacturing equipment — which was a disincentive to capital purchases and prevented job growth.
Just look at the outcomes in Michigan after these reforms. When Michigan voters hired me as governor seven years ago, the state’s unemployment rate was one of the highest in the nation at 11.2 percent. Today, Michigan’s unemployment rate is 4.3 percent. In 2017, Michigan reached its lowest unemployment rate in 17 years — a dramatic improvement since I took office.
In 2010, Michigan was at the bottom in the nation for job creation. As of today, the Snyder/Calley administration has helped create more than 500,000 new private-sector jobs — more than any other state in the Great Lakes region and the sixth best in the nation. Michigan leads the country in new manufacturing jobs. Michigan is first in the Great Lakes region in per capita increases and seventh in the nation, meaning more Michiganders are making more money. It is no wonder Michigan is the comeback state.
Like President Donald Trump has said, tax reform done right is “pro-growth, pro-jobs, pro-worker, pro-family and pro-America.” Michigan’s tax reform has been essential for our state’s reinvention. Now we need federal tax reform to empower our nation and continue helping Michigan workers, aid families, and support our businesses.
Our nation should follow Michigan’s example and enact smart federal tax reform that is simple, fair and effective to recharge our national economy and the American spirit.
Rick Snyder is governor of Michigan.