MADISON, WI (WSAU) - The state’s new budget package that passed the Joint Finance Committee last week has one tax watchdog both pleased and concerned. The Wisconsin Taxpayers Alliance, also called WISTAX, is optimistic that the new budget simplifies the tax code, eliminates some exemptions, and lowers the tax rate for most people, but President Todd Berry is concerned about building this budget with some borrowing and relying heavily on estimates of future revenue collection. “Spending increases or tax cuts predicated on money we do not have but estimate (mean) if we’re off at all, we end up holding the bag, and then having to either go back and increase taxes or cut spending at a future time, which is exactly what we did in spades the last few years.”
Berry says the same partisan arguments tend to come out whenever there is a proposal to cut taxes. “One side of the aisle is saying it isn’t fair, that too much of the cut is going into upper-middle income kind of ranges. That’s true mathematically. The comeback to that is that they’re the ones that are paying the taxes.”
Although Berry is concerned about the borrowing and if the future revenue estimates are accurate, he is pleased with this package eliminating some of the problems of the present tax code. “They’ve identified quite a few tax credits to get rid of, and they got rid of some differences between state and federal law, in which the numbers have been exploding over the last ten years, and that’s good. Those kind of things simplify the law.”
The new budget includes most of a tax cut package by State Representative Dale Kooyenga, who is on the Joint Finance Committee and is also an accountant by trade. Berry says Kooyenga’s plan drops the tax rate for most earners from three rates above 6.15% down to 5.94%. Berry says the late arriving plan passed Joint Finance, but could still be derailed, since it has a big impact on the general fund and could place it in competition with other legislative or gubernatorial priorities.