Exploring the Effects of Changes to Wisconsin’s Tax Mix

Wednesday, May 28, 2014 at 2:11 PM by

It’s easy to explore the effect that changing Wisconsin’s tax mix would have on taxpayer groups at different income levels, thanks to a new interactive data feature put together by the Wisconsin State Journal. Users of the website can see how cutting the income tax and raising the sales tax would result in higher taxes for many Wisconsinites,  and give big tax breaks to the highest earners.

The Wisconsin State Journal relied on information from the Wisconsin Budget Project and the Institute for Taxation and Economic Policy for this project.

The website allows you to set the level of the sales tax and the income tax independently, and see what changes result. For example, you can show how increasing the sales tax to 7.5% and cutting the income tax in half would result in an average tax increase of about $250 for people who earn the least, while giving an average tax break of $25,000 to taxpayers in the highest income group. This move would also reduce state tax revenue by over a billion dollars a year.

Some state policymakers have advocated for cutting the income tax and raising the sales tax to make up for some or all of the lost revenue. At the end of last year, Governor Walker mused about this possibility, although he has yet to take any specific action. By using this website, you can show how moving in this direction will give big tax breaks to the top 1%, and result in higher taxes on average for people who earn less.

The interactive website is accompanied by an article that compares Governor Walker’s and Mary Burke’s approach to potential changes in tax policy. In the article, Wisconsin Budget Project Director Jon Peacock notes that low-income families in Wisconsin have been paying higher taxes, as the legislature cuts tax credits that keep taxes low for low-income families.

Click here to explore how changes in the tax mix affect the amount of taxes paid by different income groups.

Tamarine Cornelius

Categories: Blog, income taxes, sales tax, STATE TAXES | Comments Off on Exploring the Effects of Changes to Wisconsin’s Tax Mix

Comments are closed.