{"id":3433,"date":"2023-06-13T18:17:01","date_gmt":"2023-06-13T18:17:01","guid":{"rendered":"https:\/\/wifamily.news\/?p=3433"},"modified":"2023-06-13T20:02:18","modified_gmt":"2023-06-13T20:02:18","slug":"wisconsin-cannot-wait-to-catch-midwest-nation-in-tax-rate-competitiveness","status":"publish","type":"post","link":"https:\/\/wifamily.news\/?p=3433","title":{"rendered":"Wisconsin Cannot Wait to Catch Midwest, Nation in Tax Rate Competitiveness"},"content":{"rendered":"

This post originally appeared at https:\/\/www.wmc.org\/op-eds\/wisconsin-cannot-wait-to-catch-midwest-nation-in-tax-rate-competitiveness\/<\/a><\/p>\n

By Evan Umpir<\/em><\/strong><\/p>\n

Next month marks 112 years since Wisconsin became the first state in the nation to levy an income tax.[1]<\/a>\u00a0 Since then, 40 other states have enacted an income tax.\u00a0 Over a century later, Wisconsin finds itself slipping behind the nation in tax policy.\u00a0 States are in a race to lower, flatten and even eliminate income taxes altogether.\u00a0 From a farmer in Sauk County to a factory worker in Beaver Dam and from a truck driver in Green Bay to a doctor in Hudson, everyone will benefit from returning Wisconsin\u2019s $6.9 billion surplus to taxpayers by enacting meaningful income tax reductions.<\/p>\n

In 2021 and 2022, 43 states acted to provide tax relief for workers and businesses, including twenty-one states that cut income tax rates.[2]<\/a>\u00a0 Fifteen years ago, Utah adopted a five percent flat tax. More recently, Arizona moved to a 2.5 percent flat rate and Colorado a 4.4 percent rate. This left the president of the Utah Taxpayer Association saying, \u201cwe\u2019re no longer the cool kid on the block at all.\u201d[3]<\/a> With a historic surplus, we cannot afford to improve our tax climate slowly and cautiously. As other states take bold steps to reduce and flatten their income tax, the status quo or incremental progress just results in Wisconsin falling behind.<\/p>\n

Wisconsin\u2019s top 7.65 percent income tax rate is the eighth highest in the nation and we are the eighth least tax-friendly state for middle class families.[4]<\/a>\u00a0 Nine states have no income tax and another thirteen states have a flat rate or are moving toward one.\u00a0 In the Midwest, all but one of our peers have lower or flat rates ranging from 3.15 percent to 4.95 percent.\u00a0 Even Illinois has a lower income tax than Wisconsin!<\/p>\n

In addition to providing much-needed tax relief to Wisconsinites, making the tax code more competitive would help address Wisconsin\u2019s severe worker shortage.\u00a0 April\u2019s unemployment rate was 2.4 percent, and there were about 93,500 jobs open on the Job Center of Wisconsin\u2019s website in early June.[5]<\/a><\/p>\n

Data show that workers are flocking to low- and no-tax states, while they are fleeing high-tax states.\u00a0\u00a0 In 2022, the states that saw the most population growth were low-tax states.\u00a0 The Tax Foundation found that, \u201c[i]n the top third of states for population growth (including D.C.), the average combined top marginal state income tax rate is about 4.0 percent. In the bottom third, it\u2019s about 6.6 percent.\u201d[6]<\/a>\u00a0 Any individual in Wisconsin making over $12,760 a year is taxed over 4.0 percent, and our top two rates average 6.5 percent.<\/p>\n

Most importantly though, the direct impact of returning the taxpayers\u2019 surplus is ensuring that workers and businesses are able to keep more of their hard-earned dollars.\u00a0 Businesses will use the additional dollars for higher wages, capital expenditures and investing in their local communities. Meanwhile, workers will have more money in their pockets to spend or save how they see fit. As a bonus, all of this will result in higher payroll, sales and other tax collections for state and local governments.<\/p>\n

Recent studies of different tax proposals all point to significantly higher after-tax household income.[7]<\/a> Imagine having another $1,500 or $1,800 or more in your pocket every single year.[8]<\/a> What would you and your family do with an infusion of cash like that? And how much additional economic growth would be spurred through increased spending and a faster growing population?<\/p>\n

WMC Foundation\u2019s Wisconsin 2035<\/em> Report stated that, \u201cpeople follow opportunity, but high taxes can serve as a deterrent. As other states take action, Wisconsin cannot rest on its laurels. A bold tax reform plan will help drive the state\u2019s economy forward.\u201d\u00a0 If recently re-elected Democrat Governor Jared Polis can advance his goal of eliminating<\/em> Colorado\u2019s individual income tax[9]<\/a> to become the \u201ccool kid on the block,\u201d surely Wisconsin can charge \u201cForward\u201d and unlock prosperity and opportunity by enacting meaningful tax reduction.<\/p>\n

As the Legislature finalizes the state budget, call or email your legislators and tell them to make Wisconsin more competitive and return the taxpayers\u2019 surplus to you \u2013 the hardworking people of Wisconsin!<\/p>\n

Contact your state legislators and the governor by visiting: www.wmc.org\/action-center-income-tax-cut\/<\/a><\/span><\/p>\n

Evan Umpir is Director of Tax, Transportation & Legal Affairs at Wisconsin Manufacturers & Commerce \u2013 the combined state chamber and manufacturers\u2019 association.<\/em><\/strong><\/p>\n

\u00a0<\/u><\/p>\n

[1]<\/a> 1911 Wisconsin Act 658, available at: https:\/\/docs.legis.wisconsin.gov\/1911\/related\/acts\/658.pdf<\/a>; https:\/\/www.wpr.org\/wisconsin-and-creation-modern-income-tax<\/a>.<\/p>\n

[2]<\/a> https:\/\/taxfoundation.org\/state-income-tax-relief-2023\/<\/a>.<\/p>\n

[3]<\/a> https:\/\/www.wsj.com\/articles\/the-state-tax-cut-movement-budget-revenue-flat-tax-11675120292<\/a>.<\/p>\n

[4]<\/a> Author\u2019s calculation based on Americans for Tax Reform State Tax Rate Map;\u00a0 https:\/\/www.kiplinger.com\/taxes\/least-tax-friendly-states-for-middle-class-families<\/a><\/p>\n

[5]<\/a> https:\/\/jobcenterofwisconsin.com\/<\/a><\/p>\n

[6]<\/a> https:\/\/taxfoundation.org\/state-population-change-2022\/<\/a><\/p>\n

[7]<\/a> https:\/\/crowe.wisc.edu\/wp-content\/uploads\/sites\/313\/2023\/05\/FiveOptions.pdf<\/a><\/p>\n

[8]<\/a> Dan Spika, Memo to Sen. Devin LeMahieu on LRB 1049\/1, Legislative Fiscal Bureau (January 12, 2023).<\/p>\n

[9]<\/a>: https:\/\/www.nationalreview.com\/2023\/02\/colorado-on-track-to-eliminate-its-income-tax\/<\/a> (\u201cI don\u2019t expect that we can fully eliminate the income tax by our 150th anniversary [in 2026], but let\u2019s continue to make progress.\u201d)<\/p>\n

The post Wisconsin Cannot Wait to Catch Midwest, Nation in Tax Rate Competitiveness<\/a> appeared first on WMC Wisconsin’s Chamber <\/a>.<\/p>\n","protected":false},"excerpt":{"rendered":"

This post originally appeared at https:\/\/www.wmc.org\/op-eds\/wisconsin-cannot-wait-to-catch-midwest-nation-in-tax-rate-competitiveness\/ By Evan Umpir Next month marks 112 years since…<\/p>\n","protected":false},"author":2,"featured_media":440,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[16],"tags":[],"class_list":["post-3433","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-wmc"],"_links":{"self":[{"href":"https:\/\/wifamily.news\/index.php?rest_route=\/wp\/v2\/posts\/3433","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/wifamily.news\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/wifamily.news\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/wifamily.news\/index.php?rest_route=\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/wifamily.news\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=3433"}],"version-history":[{"count":1,"href":"https:\/\/wifamily.news\/index.php?rest_route=\/wp\/v2\/posts\/3433\/revisions"}],"predecessor-version":[{"id":3434,"href":"https:\/\/wifamily.news\/index.php?rest_route=\/wp\/v2\/posts\/3433\/revisions\/3434"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/wifamily.news\/index.php?rest_route=\/wp\/v2\/media\/440"}],"wp:attachment":[{"href":"https:\/\/wifamily.news\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=3433"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/wifamily.news\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=3433"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/wifamily.news\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=3433"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}