Friday, January 18th, 2019

Can we repeal the rest of Doyle’s tax increases?

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In an op-ed for the MacIver Institute that appeared this week, I reminded readers that we still have not eliminated former Governor Jim Doyle’s tax increases, nor have we cut overall state spending.

Even with all of the progress made, there is still unfinished business that the Republicans need to take care of in the coming legislative session. As the MacIver Institute’s Brett Healy pointed out in an op-ed column, spending has actually gone up under Governor Scott Walker. With that $70 billion biennial budget, taxes are still too high and the rate is too “progressive” for robust economic growth.

Wisconsin still ranks 43rd on the Tax Foundation’s Business Tax Climate Index. The top income tax rate is 7.65%, down from the 7.75% set by Governor Jim Doyle and the Democrats controlling the legislature at the time. The other three rates are 6.27%, 5.84% and 4.0%.

When Illinois temporarily raised their flat rate to 5%, still less than Wisconsin’s three highest rates, there was much attention focused on how it was a 67% increase. Wisconsin was poised to poach Illinois businesses. That temporary rate increase is about to expire, and our friends to the south will soon be paying a flat rate of 3.75%.

Illinois is a fiscal basket case and that may not bode well for their future, but Wisconsin is one budget cycle away from joining them if we continue to use growing tax revenue to fund more spending in the state budget. We won’t like it when the “open for business” signs start facing north.

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