Taking advantage of an unexpected revenue windfall, Republicans on the Wisconsin Legislature’s budget committee voted Thursday to approve about $3.4 billion in income, business and property tax cuts, wrapping up its work on the two-year spending plan.
The Republican plan would bring the state’s third income tax bracket down from 6.27% to 5.3%, generating about $2.7 billion in relief. That bracket encompasses individuals making between $23,930 and $263,480 per year, and households earning between $31,910 and $351,310 per year.
Lawmakers set aside $202 million to offset a repeal of the state’s personal property tax which applies, in general, to furniture, equipment, machinery and watercraft owned by businesses. A portion of that tax — which provides funding to schools and local governments — was eliminated in the 2017-19 budget.
Committee co-chair Sen. Howard Marklein, R-Spring Green, noted that the tax is frustrating for those who pay it because it continues to apply every year — not just when the taxed item is purchased.
The motions passed Thursday also include a $72 million increase in aid to technical colleges and an additional $408 million for general school aid. They also remove a reduction in general school aid associated with some independent charter schools. Because spending caps remain in place, that funding would result in a decrease in property taxes. In total, the budget reduces property taxes by about $647 million.
The Republican tax measures are based on the idea that “taxpayers will do a better job, a more responsible job” than government would with the majority of the $4.4 billion more than expected that the state is projected to take in over a three-year period, said co-chair Rep. Mark Born, R-Beaver Dam.