The Big Giveaway: Updated Figures
New Information on Credit Amounts for Highest Earners
Wisconsin’s Manufacturing and Agriculture Credit is expensive, does little to encourage job growth, and is significantly tilted in favor of the highest earners, as described in the Wisconsin Budget Project’s June 28th, 2016 report, The Big Giveaway: Costly Tax Credit has Done Little to Boost Employment.
Now, new information sheds additional light on the size of the tax credit for the very richest people in Wisconsin. The figures are included in a June 28, 2016 memo from the Legislative Fiscal Bureau to Representative Gordon Hintz. The new figures include estimated amounts for tax year 2017 and are more up-to-date than the ones used in our earlier report. The memo also include additional information on credit amounts for tax filers with extremely high incomes. The updated information shows:
- Eleven tax filers with incomes of $35 million and above will receive an estimated combined income tax break of $21.5 million in 2017 from the Manufacturing and Agriculture Credit (MAC). Those 11 filers receive an average income tax break of nearly $2.0 million each.
- $105.7 million of the tax credit is claimed by just 381 tax filers, all of whom have incomes of at least $2.8 million. That is 51% of the total tax credit amount paid through the individual income tax. Those 381 tax filers receive an average tax cut of $278,000.
- Tax filers with incomes of $100,000 and under receive just 1.9% of the value of the MAC that is paid through the individual income tax. About 70% of the credit is paid through the individual income tax, with the remainder paid through the corporate income tax.