Wisconsin tax in top 10

MADISON — U.S. Census figures released Monday show state-local taxes in Wisconsin claimed 11.2 percent of personal income in 2009, ninth highest among the states, the Wisconsin Taxpayers Alliance (WISTAX) reported Monday. During the prior year, Wisconsin taxes claimed 11.7 percent of income but the state ranked 11th. The 2009 decline in tax burden reflects a temporary increase in federal stimulus funds used to replace state tax dollars, as well as the recession. Wisconsin’s tax burden (11.2 percent of income) was almost 10 percent above the U.S. average (10.2 percent of income). Most of the difference was due to individual income and property taxes. Both were more than 25 percent above the national norm in 2009; the property tax ranked ninth and the income tax, 11th.

“Because Wisconsin has historically relied less on sales taxes and federal aid than other states, individual income and property taxes are used to a greater extent than in most states,” WISTAX President Todd A. Berry said. Sales taxes ranked 34th (about 13 percent below the U.S. average) and corporate income taxes ranked 23rd (17.3 percent below).

Another way to compare state revenues is to add to taxes various user fees and charges, such as those for higher education, public hospitals, and local sewers. In 2009, Wisconsin taxes and fees combined claimed 14.4 percent of personal income (11th highest nationally) vs. 14.9 percent (15th highest) during the prior year. While some cite this figure as the state’s “tax rank,” it is more accurate to call it taxes-plus-fees. WISTAX notes that, while fees are discretionary, taxes are mandatory.

Rather than use income, some tax researchers compare state taxes based on population. Per capita, state-local taxes here ranked 16th, while taxes and fees combined ranked 17th. Because Wisconsin’s personal income per capita is below average, its revenue rankings are higher relative to income than relative to population.

In addition to revenues, the U.S. Census also compares state-local spending. In 2009, direct general expenditures here claimed 20.9 percent of personal income, 21st highest nationally. In 2008, these expenditures accounted for 20.5 percent of income and ranked 25th. WISTAX will provide more detail on the new Census information in forthcoming issues of its biweekly Focus newsletter.

A free copy of these newsletters are available at www.wistax.org; or e-mail wistax@wistax.org; call (608) 241-9789; or writing WISTAX at 401 N. Lawn Ave., Madison, WI 53704-5033.

[Note: The Census Bureau defines taxes to include several fees, such as vehicle registration, drivers’ licenses, and several sportsmen’s fees.]

The Wisconsin Taxpayers Alliance (WISTAX), founded in 1932, is the state’s oldest nonprofit, nonpartisan government-research organization.

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