Wisconsin Tax Burden Stays Low, Report Says

As Wisconsin lawmakers spar over the possibility of further tax cuts in 2024, a report released today found that the state’s tax burden remains near its all-time low.

The tax burden, or amount of money that state and local governments collect in taxes divided by the total earnings of its residents, is a way of measuring how onerous Wisconsin’s tax environment is for its people.

In 2022, the ratio dropped to its lowest on record, according to findings from the Wisconsin Policy Forum, and the think tank’s new report shows the burden largely remained at that low water mark in 2023.

There was a modest increase in state and local tax collections in 2023, with governments collecting a combined $36.23 billion, a 2.5% rise from the year prior. Wisconsinites actually paid less in taxes to the federal government last year.

Residents also experienced only a small increase in incomes last year, ticking up by 2%. That means they didn’t gain much wiggle room in being able to meet their tax bills.

Overall, 10% of Wisconsin residents’ incomes went toward taxes in 2023, with the tax burden consistently falling in recent years. The Wisconsin Policy Forum found the burden has been less than 11% of personal income each of the last nine years, something which had not occurred since at least the 1970s.

Nationally, data from the Tax Foundation found Wisconsin had a higher than average tax burden in 2022, though it fell well short of New York, which has the highest in the country at just shy of 16%.