Gov. Scott Walker wants to give to taxpayers, half of Wisconsin’s projected $1 billion surplus. An Assembly committee sought opinions on the idea Wednesday.
The governor’s plan would reduce income taxes in 2014 by $100 million and property taxes by $400 million. Revenue Secretary Rick Chandler explained the rationale.
“We want to continue to make progress in reducing the state’s tax burden and reforming the state’s tax code and we want to continue to make progress in improving the state’s fiscal stability,” Chandler says.
Chandler says taxes on a median value home would drop by $100. One person skeptical of the plan is Democratic state Rep. Gordon Hintz. He says tax cuts could eventually cause another state budget shortfall.
“We always say we have to budget like a family does well, what family in the world would give away the farm? It’s like throwing a high school graduation party with your college savings,” Hintz says.
Hintz cautioned lawmakers not to succumb to election year politics. Democratic Assemblyman Tod Ohnstad says he’s concerned about reports that tax cuts would largely benefit Wisconsin’s wealthier residents.
“An analysis shows that 44 percent of the benefits would go to the highest 20 percent. The Wisconsin Budget Project says the top five percent of Wisconsin residents get 18 percent of the tax cuts. I guess I’m a little confused about that,” Ohnstad says.
One person who says he’s not confused about the potential benefits is Republican Rep. Dale Kooyenga of Brookfield. He insists the tax cut plan would aid the struggling middle class.
“It’s going to help our businesses, it’s going to help our families, it’s going to help the not-for-profits that rely on donations from these individuals that are paying high taxes,” Kooyenga says.
Kooyenga reminded the audience that the governor’s plan would also set aside $100 million in a rainy day fund. Assembly leaders say the tax cut plan could make its way to the floor for a vote, next week.