So...it looks like the republican lawmakers in Madison are getting to the end of the sausage-making process when it comes to the next budget.
It’s two-year budget that has been easy to craft, in the sense that the state is sitting on a seven-billion-dollar surplus- and so- of course we were going to get a lot of additional -and new-spending because of that.
And boy-have we: I’ve been sitting here, watching so-called ‘conservative’ republicans giving away the store: a billion dollars of new K-12 spending even though we have massively, massively funded our public schools in every single budget since act ten. It’s insane that republicans keep falling for this yearly democrat whine that our public schools are underfunded... So that’s another billion dollars-
They got additional spending on choice and charter schools, too, which is a conservative agenda item, but it still amounts to even more spending. What was it? Another 400 million for that?
Then there’s the half a billion dollars for a 15 percent increase in shared revenue...and the ability to allow for the Milwaukee County sales tax to be raised by half a percent and for the city of Milwaukee to create an entirely new sales tax- of two percent-
So yep, with ‘conservatives’ in charge here, Wisconsinites are still ending up with a state budget that will be amount to over 40-billion dollars in spending each year-
And for comparison- this started out as a 30-billion dollar a year budget in the walker era-and so- is it really ‘conservative’ budgeting if republicans have overseen the process the entire time and state spending has leapt about 30 percent in 12 years? I’m not sure it is.
But- all we’ve seen or heard about for the last several months is how we will be spending more on this. And more on this. And more on that.
And any talk of a significant tax cut has been entirely lost in the weeds. And -generically- Speaker Vos has told that that that’s coming soon: that they needed to get the rest of the items funded first-
Yeah- okay- get it. But this had better be a damn significant tax cut-in light of all of the additional spending they are doing both ‘one time’ spending and ‘legacy spending’.
It’s important to understand that-out of a seven-billion-dollar surplus- more than half of that is one-time federal money that evaporates as a revenue source once it’s spent. And so, it would be stupid to spend any of that money on budget items that are going to add additional costs to the budget- every year- moving forward.
And -from what I’ve seen-these GOP budgeters have been careful not to do that...
But then there’s also about three billion dollars of this seven billion that was just ‘surplus state money’.
That three billion dollars was simply the excess tax money that the state’s various taxing schemes took out of our paychecks...or purchases...and dumped into the state treasury.
Good.
So- darn it-give it back. Admit that -even with responsible republicans in charge-you have been taxing the Wisconsin citizenry more than you must- and give it back.
This is the piece of this budget that I and so many others have been waiting for: you know, the actual ‘conservative piece’. The display of some fiscal responsibility. The display by these elected lawmakers that they understand that that is-our money. We taxpayers. And they took it in excess. And now it’s time to give it back.
And yes, there is ‘some’ sort of tax cut or tax rebate coming....
But-as we near the end of the budget process-the two biggest questions are:
-how are you returning it to taxpayers? Via what vehicle? Rebate? Tax cut? How big a tax cut? Etc.-
And-
How much are you returning?
Are we going to get a play that returns nearly all 3 billion in excess to the taxpayers? As Speaker Vos initially suggested?
Or-after all of this additional spending and bowing to Tony Evers- are we going to get some sort of pathetic...1.5- or 2-billion-dollar figure...with Madison republicans pretending it’s a huge return?
The way that these lawmakers are likely to return this money is with a tax cut: it won’t be some one-time rebate check to taxpayers that’s going to cost half-a-million dollars just to mail out...
It'll more likely be a cut to the tax rates...so that they are taking less from us...moving forward.
Okay great. But-how big is the tax cut going to be? And where will it be placed?
We know Tony Evers isn’t going to go for a bold idea like moving Wisconsin’s income tax to a ‘flat tax’...as we should do...
But...will republicans slash the top tax rates in Wisconsin down to more realistic levels?
Because right now, the top income tax rate in Wisconsin is nearly 8 percent...when all of the other midwestern states-other than Minnesota are far, far lower than that. Indiana’s top income tax rate is about three percent. Iowa and Michigan’s top tax rates are around four percent- even Illinois’ is only around five percent-
Why is Wisconsin’s top tax rate nearly 8 percent?
Slash it down to four-and make Wisconsin far more competitive for jobs, job creators, and job seekers to come here.
We have talked about how all the higher-tax states have been losing population and the taxes from those paychecks as people leave- and head to red states. We think of California, New York, and Illinois losing a lot of workers and taxable wages to other states that way-
But we just got a study that suggested about we lost about 100-thousand Wisconsin workers to lower tax states in 2021...and that attrition will continue every year-until we reduce our state income tax burdens here.
And you know what? All the states that are benefiting from this migration and worker growth have an average state tax rate of less than three percent. Many of them have no state income tax- or only low ones.
We must reduce our overall state tax burden if we are going to remain competitive with the other states- and even with our surrounding states. Let Minnesota have its top tax bracket at nine percent- let’s move ours down to three-and a-half or four and flatten out Wisconsin’s tax brackets.
That! Is what these GOP lawmakers need to do this year-with this surplus-
And knowing that Gov Evers would veto a move to a 3 or 3.5 percent flat tax: at least flatten and reduce the number of brackets-and show us taxpayers that some -real- tax savings is in our near future.
Demonstrate to us that we are going to be able to keep more of that paycheck that we earned.That’s got to be the mission, here.A one-time rebate is just that: a one-time thing. And it is-never- redistributed fairly-back to the taxpayers. That’d be more of a political stunt, for show, than taking this opportunity to make lasting changes and lower our tax structure in Wisconsin.
And to be clear-I fully expect that this is what robin Vos and Devin LeMahieu and our GOP budget writers are working on: i don’t want you all hacked off at them- with a black cloud over your heads- for no reason here. Yet.
I’m doing this segment to urge them to keep the promise that they made to us-the taxpayers-at the start of this budget process, too. They seem to have gone out of their way to help Governor Evers spend billions of dollars and keep his promises to his voters-
Now- let’s see them keep their promise to- their voters. Republican voters and fiscal conservatives. They need to give us a significant and lasting shift in the way Wisconsin is taxing us, if they are going to keep that promise: flatten the brackets-and get the average taxpayer some real savings-moving forward.
We have all sorts of nations that have moved to a flat tax over the last few years- and here Wisconsin is-with several brackets-and a top income bracket of 7.7 percent-which is the 8th highest in the nation.
Now- why?
Why? Would Wisconsin? Be one of the 50 states that’s taxing its best earners at that high a rate?
That’s idiotic.
Especially when nine states now have no income tax and 13 states either already have a flat tax-or are moving to one-and several of those states are here in the Midwest. Competing with Wisconsin for workers and paychecks to tax to fund their governments.
And as I say: there’s no need to get angry at GOP lawmakers who -know all of this-or who have promised to return a large chunk of this surplus back to us-
But I’m a little worried they’ve lost their way.
I’m a little worried that the tax -cutting- part of this surplus budget is so lost in the weeds that they’ve all-but forgotten about it.
And so- if you are so inclined- call or email your state lawmaker’s office and remind them that they promised to return this surplus -to us- the taxpayers. Remind them-you owe us a significant tax cut, yet now that you’ve made Tony Evers happy and have bailed out Milwaukee democrats for their decades of fiscal mismanagement.
It's time to get serious about tax cuts.
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