Updates About Economy

According to the Senate Fiscal Agency’s July 2025 Revenue Report, Michigan’s major taxes and net lottery revenue totaled $2.9 billion in July, down 1.6% from last July and about $130 million short of their May prediction. General Fund revenues came in $125.9 million less than forecasted, while School Aid Fund revenues missed expectations by $15.7 million.

Contributing factors included individual income tax refunds that were larger than originally anticipated, paired with smaller corporate income tax receipts and lower net lottery revenue. Stronger results from real estate transfers, the sales tax increase of 4.5%, and wagering taxes helped, but not enough to offset. So far this fiscal year, General Fund and School Aid Fund revenues remain $53.0 million and $3.6 million below expectations, respectively.

Governor Gretchen Whitmer has signed an executive directive requiring state offices to assess the impact of federal tariffs on Michigan’s economy. Executive Directive 2025-5 instructs that by August 30, the following departments are to review data that may shed light on the impact of new tariffs in Michigan: Department of Agriculture and Rural Development; Department of Environment, Great Lakes, and Energy; Department of Natural Resources; Department of Technology, Management, and Budget; Department of Transportation; and the Michigan State Housing Development Authority.

Here in Michigan, the impact of tariffs is poised to be much higher than in many other states due to our manufacturing and agriculture-heavy economy. Already, the state has experienced rising costs and disrupted supply chains. Whitmer has expressed concerns about the negative effects these tariffs will have on Michigan families and businesses. The directive was issued one day before President Trump’s August 1 tariff deadline.

Governor Gretchen Whitmer announced recently that Sandisk, the semiconductor company previously eyeing Michigan’s Mundy Township megasite, has pulled out of the project due to national economic uncertainty. The company, which had applied for CHIPS Act funding, decided not to move forward with building any U.S. plants, citing concerns over tariffs and stalled federal support. Whitmer emphasized Michigan’s continued commitment to attracting advanced manufacturing investment, despite growing headwinds at the federal level. The Mundy site remains available for future development.

Read previous coverage on Michigan’s semiconductor industry here: GOVERNOR WHITMER OUTLINES BOLD VISION FOR MICHIGAN’S SEMICONDUCTOR FUTURE