Wisconsin Near Average in Per Capita Revenue and Spending

Monday, December 22, 2014 at 9:02 PM by

New figures released last week by the Census Bureau show that total state and local spending and revenue in Wisconsin is not much different in Wisconsin than the per capita figures for the nation as a whole.  For example, our analysis of the new data – which is for state and local revenue and spending in 2012 – found the following:

  • Wisconsin ranks 25th in total revenue (including federal aid) per capita, and was 1.5% below the national average on that measure.
  • Looking at all state and local revenue per capita, but excluding federal financing, Wisconsin ranked 19th and was 1.1% above average.
  • We ranked 24th in total spending per capita, 2.9% below average, and 21st (just 0.2% above average) in a slightly narrower spending measure – direct general spending – which I think is better for comparative purposes because it excludes things like state-owned enterprises.

Wisconsin’s figures are higher compared to the national averages when they are measured relative to income, because personal income in Wisconsin is well below the average nationally. For example, we are 0.3% above average (27th) in total spending per capita, and 3.5% above average (23rd) in direct general spending. 

Most of the media attention to the new figures has focused on the portion of a WI Taxpayers Alliance analysis indicating that Wisconsin ranks 12th in state and local taxes as a percentage of income. Wisconsin’s rank on that measure has gradually been moving from the top, falling from 4th in 2000. Wisconsin is higher on this measure than on the other spending and revenue measures for several reasons:

  • We rely less on fees and more on taxes than most other states.
  • We rank low in federal financing; only 11 states received less federal revenue per person in 2012.
  • Because of our lower average income, we rank higher (12th) when that is the denominator for the tax ranking than the per capita measure (15th).

Go to the Wisconsin Budget Project’s website to read more about Wisconsin’s rankings in different measures of tax and spending, and to see how each of the measures has changed since 2000.

You can also take our brief quiz: Test Your Knowledge of Taxes and Spending in Wisconsin. You might be surprised by some of the answers.

 Jon Peacock

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