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MI Groups Support Repealing Pension Tax, Capping Insulin Costs


Friday, January 28, 2022   

Groups advocating for seniors are applauding Gov. Gretchen Whitmer's plans to prioritize repealing the pension tax and placing a cap on out-of-pocket costs for insulin.

During the State of the State address this week, Whitmer focused on jobs, targeted tax cuts, the economy and education.

Melissa Seifert, associate state director of government affairs for AARP Michigan, said in 2011, a slate of tax-code changes included removing exemptions for pensions as taxable income. Those born before 1946 could keep their exemptions, those born between 1946 and 1952 got a smaller exemption, and those born after 1952 had to pay taxes on all their pension income.

"AARP has been for the last 10 years advocating to really prioritize repealing that pension tax," Seifert explained. "To make an equal playing field among retirement income and have it all taxed kind of in the same way, so nobody was really left behind. "

Seifert pointed out with ever-rising costs for housing, medical care and many other expenses, many retirees have had to return to work to pay the bills. She hopes repealing the pension tax will help seniors on fixed incomes continue to support themselves in retirement.

When it comes to the cost of prescription drugs and insulin in particular, Whitmer said she supports a cap on the out-of-pocket costs per month.

Dana Nessel, the state's attorney general launched an investigation this week into one of the three drug companies responsible for making almost all the nation's insulin.

Seifert argued older Americans would benefit greatly from these steps.

"Between the pension tax and also cutting out-of-pocket costs for individuals who use insulin, it's just really going to be an economic driver we think for the state of Michigan," Seifert contended.

Prescription drugs in the U.S. on average cost 2.5 times as much as medications in other nations. Seifert added with people still struggling economically due to the pandemic, it is important to reduce those costs as soon as possible.

Disclosure: AARP Michigan contributes to our fund for reporting on Health Issues, Livable Wages/Working Families, and Senior Issues. If you would like to help support news in the public interest, click here.

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