Great Lakes Wire

A group known as “Invest in MI Kids” has started collecting signatures to place a constitutional amendment on Michigan’s 2026 ballot. The proposed amendment would introduce a new tax bracket, adding an extra 5% tax on taxable income over $500,000 for individuals and $1 million for joint filers. This would bring the combined tax rate to 9.25%. The change would also affect business income for pass-through entities, meaning many small business owners could be impacted.

According to data from the Internal Revenue Service, at least two-thirds of those who would pay this higher rate are Main Street business owners. The measure is expected to generate just over $1 billion, which is designated for the School Aid Fund and must be used to support classrooms in local school districts. However, because of how the state budget process works, there is no guarantee that education funding will increase by $1 billion.

The National Federation of Independent Business (NFIB) has joined other organizations to oppose the amendment. “We want to be proactive and engage in both a ‘decline to sign’ campaign to encourage people not to sign this (or most other) petitions,” NFIB stated. “This will be in addition to an education campaign to show the negative impact this proposal would have on small businesses in Michigan.”

NFIB also noted: “We know that small business owners aren’t ‘rich’, and that most money they earn goes right back into their businesses – we need to make sure that the people of Michigan understand this too!”

NFIB is asking supporters to take a survey about ways they can help prevent a graduated income tax from being implemented in Michigan.