We’ve heard it at the federal level, but it is also true in our state: the problem is not that we tax too little, it’s that we spend too much.
After working for three-and-a-half months, Wisconsinites have now earned enough money to pay off our federal, state, and local taxes. On April 16th, Wisconsin celebrated Tax Freedom Day.
Of all 50 states, Wisconsin’s Tax Freedom Day is the seventh-latest and it falls four days later than the national Tax Freedom Day. As one of the nation’s top 10 latest Tax Freedom Days, Wisconsin is also in the company of notoriously debt-laden states like California, New York and Illinois.
Our Tax Freedom Day is not the 7th latest because our state does not have high enough taxes nor do we have a $3.6 billion deficit because Wisconsinites don’t pay their fair share.
Wisconsin has a multi-billion deficit because for the past eight years, our state has spent far beyond its means with no regard for its future economic prosperity. Wisconsin’s high taxes and refusal to responsibly address our debt crisis has done grave disservice to our state’s job climate.
According to the Tax Foundation, Wisconsin has the 11th-worst business tax climate and according to Forbes’ ranking last fall, there are 42 states better to conduct business in than Wisconsin. If those rankings are not proof enough that Wisconsin needs to make some changes, Forbes also ranked Wisconsin’s growth prospects a dire 47th.
While it is a coincidence that this legislature’s first 100 days in office and Wisconsin’s Tax Freedom Day fall in the same week, it is no coincidence that the recently elected majority has used much of its first 100 days this session to reform Wisconsin’s potential for job creation.
The first bill passed this legislative session, Special Session Senate Bill 1 (SS-SB 1), made significant improvements to Wisconsin’s legal climate. As co-author of this legislation, I understand the important connection between lawsuit reform and the capacity to create jobs.
SS-SB 1 brings our state back into the legal mainstream by eliminating the flawed “risk contribution” theory of manufacturers’ lawsuits. This provision made Wisconsin the only state that allowed plaintiffs to sue for damages they could not prove the defendants, which were often employers, actually caused.
Additionally, Wisconsin passed a piece of legislation that provides tax relief to families and small businesses that purchase Health Savings Accounts (HSAs). Again, before the passage of this legislation, Wisconsin was far outside the mainstream as it was one of only few states that did not already offer this tax cut.
Perhaps the most important bill passed this session to improve Wisconsin’s business climate is the Commerce Department Reform Bill. This legislation transforms the existing Department of Commerce into the more private sector-oriented Wisconsin Economic Development Corporation (WEDC).
Whereas the Department of Commerce spent most of its time and money adding barriers and hoops for job creators to jump through, the WEDC will promote job creation by focusing on retaining businesses, attracting new growth, and creating incentive packages to encourage relocation.
In addition to these strong pro-jobs bills, the State Legislature passed legislation that requires a supermajority to pass any tax increases. This legislation proves my Republican colleagues and I are as serious about creating jobs as we are about lowering taxes. Both of these elements must be present if we expect Wisconsin’s economy to head in the right direction.
While there are many positives to reflect upon throughout my first 100 days in office, one thing is certain: I will continue to pursue my pro-jobs agenda so all of Wisconsin can celebrate Tax Freedom Day sooner in the future.
Republican State Sen. Rich Zipperer resides in Pewaukee.
