Wisconsin Republicans Try Again to Repeal Personal Property Tax

A Republican bill to ax a disliked and obscure portion of Wisconsin’s tax code got a public hearing Thursday, with lawmakers hopeful that this attempt will successfully be passed into law after a similar bill was vetoed by Governor Tony Evers in the last legislative session.

At a press conference Thursday, Republican legislative leaders said the personal property tax repeal is part of an agreement on shared revenue they struck Wednesday night with Evers.

The personal property tax has been a part of Wisconsin’s code since the state’s founding. While it initially covered all household and business property, the tax has been whittled away over the past 175 years. The application to households fell off the tax rolls with the introduction of the state income tax in 1911 and business exemptions have been continually added over the last century.

In 1974, manufacturing machinery and equipment were removed from the tax and in 1999, computers and electronic business equipment were exempted.

Under current law, only furniture, watercraft and a few other items remain covered by the tax while most of Wisconsin’s neighboring states have already fully repealed their own versions of the tax.

Republican lawmakers said at the hearing that the tax adds an onerous and time-consuming administrative task to small business owners who remain liable for paying the tax, which often isn’t that high for individual taxpayers, and for the municipal government staff responsible for assessing and collecting the taxes.

“To small business it sometimes can be more of a time strain than financial strain, the time to catalog your inventory or personal property, so furnishings, fixtures, and the list goes on,” Sen. Dan Knodl (R-Germantown) said. “But that time and effort is very time-consuming, and probably costs more than the final check that you’re writing to the local community or you’re paying your accountant to do work. You’re paying more money out that way than you are in the actual tax bill. The benefits to the local government, and I have met with all my local governments over the years, they’re to the point where, ‘please just make our compliance efforts go away, and we’d be thrilled just to take the check from the state and move along with our business.’”