Preview of Whitmer’s final budget focuses on savings for seniors, families, working class

Michigan Gov. Gretchen Whitmer arrives to give a policy speech at an event on Wednesday, April 9, 2025, in Washington. /Mark Schiefelbein)

LANSING, Mich. —Gov. Gretchen Whitmer will be proposing new tax breaks and keeping focus on existing cost-saving measures for Michiganders in her “Saving Michiganders Money Plan,” part of her final budget recommendation.

Whitmer will present her Fiscal Year 2027 Executive Budget Recommendation to the Michigan Senate and House of Representatives on Wednesday afternoon, and ahead of that, announced on Monday the Saving Michiganders Money Plan that would complete a full rollback of state tax on retirement, maintain an end to state taxes on Social Security, tips and overtime and proposes a new “sales tax holiday” on school supplies.

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“As Michiganders face a lot of national economic uncertainty, we must work together to lower costs so they can pay the bills, put food on the table, and provide for their kids,” Whitmer said. “In this year’s budget, I’m proposing the Saving Michiganders Money Plan to continue lowering taxes for seniors, workers, and families, feed kids, cut taxes on school supplies, and lower the cost of a public education from pre-K through college. Let’s work together to save Michiganders money.”

A few items that would be new to Michiganders is a 10% property tax refund for certain seniors and a sales tax holiday for online and in-person purchases of school supplies such as clothes, classroom items and computers. Whitmer will also be proposing free breakfast and lunch for public school students to become permanent by law.

Things already in motion that Whitmer listed as priorities to continue include the phased rollback of the state retirement tax which has been in motion since March 2023 (effective February 2024), part of the Lowering MI Costs Plan.

Whitmer’s plan also includes a continuance of the Working Families Tax Credit expansion from 6% of the federal earned income tax credit to 30%, enacted in 2023.

State taxes on Social Security, tips and overtime went away with Public Act 24 of 2025 until 2028 and Whitmer’s 2027 budget recommendation includes keeping this.

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Free PreK For All, two years of tuition-free community college for high school graduates, Michigan Reconnect, a program that offers any Michigander 25 or older a tuition-free associate’s degree or certificate, and the Michigan Achievement Scholarship that offers qualifying students up to $27,500 to attend a Michigan public university, private college or university, or enroll in a four-year degree program at a Michigan community college, are all named as priorities for continued funding in Whitmer’s plan.

“Governor Whitmer knows Michiganders work hard for their money and deserve to keep more of it in their pockets,” Whitmer’s office said. “That’s why she’s been focused on lowering costs and making life more affordable. The Saving Michiganders Money Plan will build on the work of the past several years to roll back taxes on seniors and working families, feed kids at school, and cut the cost of higher education.”

Time will tell whether these proposals make it to the final budget, but experts expect the process to be harder this year, due to a $900 million dip in expected revenue.

“For the first time in a number of years, there’s going to need to be right off the bat, there’s not going to be room for growth in this budget, and we’re going to be cutting when the governor releases her budget,” Bob Schneider, Senior Research Associate at the Citizens Research Council of Michigan said.

Many of the priorities listed in the preview are existing initiatives, but that makes sense to Schneider.

“Whether it’s the governor, whether it is house republicans, senate democrats want to have a big new program or something new, it’s gonna have to come out of something that’s already in the budget,” Schneider said. “It’s a lot easier to build those, propose those new things when you have a billion dollars in extra revenue on the table. That’s not going to be the case this year.”

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The top appropriators in the legislature are responding to the preview.

“As Senate Appropriations Chair, I’ve used my role to deliver real, cost-saving relief for everyday Michiganders — repealing the retirement tax, expanding the state’s Earned Income Tax Credit, and eliminating taxes on tips and overtime pay,” Sen. Sarah Anthony (D-Lansing) said. “I hope we can use the FY 2027 budget to continue that great work by building on our efforts to expand the Homestead Property Tax Credit and put even more dollars back in the pockets of our seniors. I look forward to working with Gov. Whitmer and her team on ideas that continue to lower costs and improve the quality of life across our state.”

The chair in the House, Rep. Ann Bollin (R-Brighton), said any conversation about lowering costs is a step in the right direction.

“We should be having a conversation about meaningful, broad-based property tax reforms that help everyone, not just a small group of people,” Bollin said. “I’m also still waiting to hear how the governor plans to address the nearly $900 million hole in the state budget, because so far she’s had no plan for closing that gap. As we head into budget talks, my focus will be on cutting waste. I’m against any proposal that hurts Michigan families by creating new taxes and fees they cannot afford.”

The Mackinac Center for Public Policy echoed that sentiment, and says any budget should exercise restraint.

“It keeps us flexible for any future crisis, it allows a lot of other priorities to be affordable, It’s a good idea,” James Hohman, Director of Fiscal Policy at the Mackinac Center said. “Lawmakers do have constitutional requirements to pass balanced budgets, but I think they should go a step beyond that and spend less than every dollar they have available to them.”

The State Budget Office will unveil Whitmer’s full proposal on Wednesday.