It’s true, we are taxed enough already. As Todd Berry, president of the highly-respected and non-partisan Wisconsin Taxpayers Alliance wrote in July 2010, “State and local taxes claim 11.8 percent of personal income, 13th highest among the states.” I will continue to oppose tax increases that would take a higher percentage of income. Instead, I support a proposal to amend our state constitution to tie the level of taxation to personal incomes. Once that system is in place, if government were to spend more, it would first have to succeed with policies that increase the personal incomes of state residents.
Tax Rates are High Because Our Income is Low
Wisconsin consistently ranks among states with the highest tax rates in part because the per capita income for Wisconsin residents is below average. To avoid tax increases or drastic spending cuts, my priority is to keep and create jobs to grow our economy and add wealth to the Wisconsin community.
Wisconsin Subsidizes Federal Government
Even though personal incomes in Wisconsin are over 6 percent below the national average, Wisconsin is a donor state to Washington. Wisconsin for decades has ranked near the bottom in receiving tax dollars from the federal government. One reason is we have few federal facilities like military bases. Another reason is our state government usually enacts programs to help veterans, elderly, poor, sick and disabled community members. When the federal government finally acts, it often creates funding formulas that effectively ‘punish’ states that did the right thing by promptly addressing social needs with state dollars. One answer is for our delegates in Congress to start forming bipartisan coalitions with legislators from other donor states to change federal aid formulas. Fixing inequitable aid formulas in Washington would enable lower tax rates in Madison and across Wisconsin.
Balancing Income, Sales, Property and Other Taxes
Debate will never end on which taxes are unfair or too high in Wisconsin. Compared to other states, our individual income taxes are above average, in particular on high income individuals. Our property taxes are 25 percent above the national norm and we have created programs that add progressivity for some property categories and lower income residents. In general, our user fees are well below average, a reason our income and property taxes are high. Our sales tax is competitive with other states. Raising our state sales tax by “One cent” in reality is a proposal to increase it by twenty percent, a non-starter plan for most taxpayers. We are taxed enough already and rather than consider higher tax rates, state government instead needs to focus on higher incomes.
Raising State Taxes to Reduce Property Taxes
Raising the state sales or income tax rates to provide local property tax relief sounds good. However, each time it has been done, the property relief has been short lived because state government raised spending and shifted the mandate to pay for more services to local property taxpayers. With no guarantee history wouldn’t repeat itself, taxpayers should be wary of plans to raise a state tax to lower property taxes.
Streamline Wisconsin Tax Code
The forms and instructions to file an individual state income tax return has exploded in recent years to 50 pages. The time it takes to read and understand instructions and complete required forms is a burden causing many taxpayers with modest income to incur the needless expense of hiring a tax preparer. I support having a non-partisan study group develop a comprehensive proposal to the legislature to eliminate numerous little-used provisions, enabling thousands of tax filers to once again prepare their own taxes, saving them millions of dollars each year.
No comments:
Post a Comment