Republican Senators introduced a bill Wednesday that seeks to eliminate the state income tax on hourly overtime pay.

Sen. Michele Hoitenga, R-Manton, one of the sponsors of Senate Bill 125, explained that rising inflation, higher living costs, and excessive government spending have forced many Michigan families to work overtime just to stay afloat. Other sponsors include Sens. Roger Hauck, R-Mt. Pleasant, Roger Victory, R-Hudsonville, and Edward W. McBroom, R-Waucedah.

“Too many Michiganders count on working overtime just to pay the bills and are struggling to survive paycheck to paycheck,” Hoitenga said.

She noted that Michigan’s middle class, comprised of welders, construction workers, nurses, and other essential professionals, is bearing the brunt of these economic challenges. Many families are cutting back on necessities, delaying major purchases, or taking on additional jobs to make ends meet.

Economists estimate that the median family’s spending power has dropped by nearly $12,000 over the past four years, further straining household budgets.

“It’s time for a new direction in Michigan—one that prioritizes economic relief for forgotten, hardworking middle-class families,” Hoitenga said.

Beyond offering direct financial relief, Hoitenga believes that removing the tax on overtime wages could help address labor shortages in critical fields, including corrections officers, paramedics, and skilled trades. By allowing workers to keep more of their hard-earned money, the bill could encourage more people to enter and remain in these essential professions.

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“It should be clear to anyone who’s keeping an eye on Lansing’s spending that there’s more than enough money in our budget that could be reallocated to afford a tax cut on hourly overtime,” she added.

Michigan’s government spending has surged by 40% over the past six years, with lawmakers recently pushing for a $700 million income tax increase on middle-class families. Hoitenga said that instead of raising taxes, lawmakers should focus on fiscal responsibility and tax relief for hardworking residents.

While tax cuts are often seen as a Republican-led initiative, Hoitenga believes this bill should receive bipartisan support as it directly benefits Michigan workers.

“I truly believe there are things that both sides can always agree on, and easing the tax burden on hardworking middle-class families across our state should be one of them,” she said.

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If passed, Senate Bill 125 could provide long-term financial relief to Michigan workers who rely on overtime pay while strengthening the workforce in essential industries.