Expanding the sales tax to pay for income and property tax cuts would harm taxpayers with low incomes – and give large tax cuts to the highest earners.
As the new school year approaches, Wisconsin schools face significant challenges.
Breaking with Tradition: How Wisconsin Lawmakers Have Shortchanged a Legacy of Investment in the State’s Future
Since 2011, a majority of state lawmakers have turned their backs on Wisconsin’s long and proud history of investment in education, health care and other assets that once ensured the state’s civic and economic progress.
Three major tax cut packages passed by the Wisconsin legislature in the last year have delivered relatively little benefit to the lowest earners, who are struggling to make ends meet. In dollar amounts, the largest tax cuts went to the Wisconsin taxpayers who earned the most.
Income inequality continues to grow in Wisconsin and the United States, producing an ever-widening chasm between the rich and the poor. Over the last 40 years, Wisconsin’s richest residents have experienced dramatic increases in income, while Wisconsinites not among the very highest earners saw their incomes stagnate or decline.
A proposed constitutional amendment that would restrict state revenue could make it more expensive to maintain roads and bridges and finance other building projects by raising the state’s borrowing costs.
The erosion of the Homestead Credit is an example of how failing to account for even small increases in the cost of living can harm tax relief in a significant way.
Legislation to use the projected surplus should target some of the funding to improve the Homestead Credit and the state Earned Income Tax Credit, or at least undo the damage done to those credits in the 2011-13 budget.