Boots & Sabers

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0640, 17 Apr 19

Feeling the weight of government

Here is my full column that ran in the Washington County Daily News yesterday.

April 15. A date that lives in infamy. As the date by which all Americans must submit their income tax forms to make sure the government has extracted enough hard-earned money to fund the bureaucracy, April 15 also serves as a good date to contemplate the cost of government. Given that this April 15 is on the cusp of Wisconsin’s biennial budget debate, it is also a good date to look at how much more costly our new governor wants to make our government.

According to the Tax Foundation, Tax Freedom Day in 2019 is April 16. That means that every dollar that every single American earned up until April 16 is needed to pay the nation’s total tax bill of $5.29 trillion. The nation’s total tax bill is more than the nation’s total combined bill for housing, clothing, and food. Big government isn’t cheap. In Wisconsin, Tax Freedom Day comes even later on April 19. The cost of Wisconsin’s government is still more than most states.

If Governor Tony Evers has his way, Wisconsin’s Tax Freedom Day will push later into the year like Illinois or New York. The governor’s budget proposal includes over a billion dollars in tax increases and would increase taxpayer disparity.

When the Supreme Court ruled last year that states can collect sales and use taxes on internet purchases, Gov. Scott Walker and the Republicans neutralized the tax burden for Wisconsinites by offsetting the new sales tax collections with an equal across-theboard income tax cut. Governor Evers would reverse that decision and give the entire tax savings to only those in the lowest tax bracket.

At the same time, Evers’ budget proposes increasing the Earned Income Tax Credit, a welfare scheme paid through the income tax system, and lower taxes in the lower tax brackets. All of these ideas would lower income taxes for those at the lower end of the income scale.

In order to make up for tax decreases to the lower brackets, Governor Evers would increase taxes on the higher brackets by forcing single people who earn more than $100,000 and couples who earn more than $150,000 to pay regular income taxes on their capital gains. This is estimated to increase taxes by $505 million on Wisconsin’s higher earners.

For some perspective, figures calculated by the Wisconsin Taxpayers Alliance show that income filers earning over $100,000 comprise about 12% of all income tax payers, but they pay over 61% of all income taxes in the state. Evers’ budget proposal would continue the effort to foist more and more of the cost of government on an ever smaller group of income earners.

Not content to only hammer individual taxpayers with higher taxes, Evers would also cap the Manufacturers and Agriculture Credit to a mere $300,000 of income for manufacturers. This is projected to result in a whopping $516.6 million in higher taxes on Wisconsin’s manufacturers.

Just in case anyone thought they might escape Evers’ tax increases, he also proposed to increase gas taxes by eight cents a gallon and then index the tax increases to inflation. That way taxes would automatically increase without politicians having to bother going on record to do it with a vote. This would raise taxes another $485 million through the budget term.

Governor Evers has made it perfectly clear how much he would raise taxes if he had the power to do so on his own. As the legislative Republicans formulate their budget proposals, they should begin with the mirror image of Governor Evers’ proposal. The Republicans should start with a billion dollar tax cut for all Wisconsinites and let the Governor try to negotiate from that starting position.

Wisconsin’s tax burden is not good, but it has been improving for the last eight years. Republicans should fight hard to maintain that trajectory for the benefit of all Wisconsinites.

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0640, 17 April 2019

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