KEY POINTS:

• Speaker Robin Vos commented about $3.4B in tax cuts being insufficient. Vos called the number “absolutely bare bones bottom… We think it would be significantly higher than that.”
• Vos commented, “Revenue without reform is DOA. We’re not going to just say more revenue is the answer to the problem.”
• Robin Vos wants to see what cost-saving changes the city of Milwaukee will make, i.e., consolidating services or merging with WRS. 
• The Republican-controlled Legislature expects to see compromises and reform in various areas. 

During a Wisconsin Policy Forum virtual event on Friday with Democrat Rep. Haywood, Republican Assembly Speaker Vos spoke about $3.4B in tax cuts being inadequate. Vos called the number “absolutely bare bones bottom… We think it would be significantly higher than that.” He added that tax cuts should favor all brackets, not just one. “They all deserve relief,” Vos said. 

“I can’t see us doing a lower tax cut than we did last time,” Vos said during the WPF event.

Vos commented about the budget surplus, “Revenue without reform is DOA. We’re not going to just say more revenue is the answer to the problem.” He wishes to see what cost-saving changes the city of Milwaukee will make, i.e., consolidating services or merging with WRS. 

Vos clarified that taxpayers should come first concerning the state’s projected $6.6 billion budget surplus.

In 2021, tax changes applied to individuals who earn between $23,930 and $263,480 annually and married couples who file taxes jointly and earn between $31,910 and $351,310 per year. Vos said the plan Republicans are likely to submit to Evers would target the middle class in addition to relief for residents in the top bracket.

Wisconsin’s income tax rates begin at 3.54% and increase to 7.65%. The top rate applies to single filers earning $280,950, married joint filers making over $374,600, and married people filing separately with taxable incomes of more than $187,300. 

Governor Evers will reveal his budget proposal to the Legislature on February 15, 2023. Over the next few months, the GOP-controlled Legislature will rewrite it before sending their two-year spending plan back to Evers’ desk sometime in June. It will cover spending from July 1 to June 30, 2025. 

This surplus of $6.6 billion gives Evers and the Legislature a massive opportunity to go over spending needs, tax cuts, or other pathways to save money. The battle is going to be “who and how much.” 

Local governments are one group being discussed; lawmakers are considering increasing the money they get from the state, AKA shared revenue. Vos said he began discussing ideas with groups representing cities, counties, villages, and towns. One possibility is to use 1% of state sales tax to replace shared revenue. 

Shared revenue for counties and municipalities dropped more than 6% in 2012 and has been flat since then. As a result, many have been calling for a different funding system. 

Vos said, “We are nowhere near what that would look like. But that broad outline seems to be one many people are interested in.” Governor Evers has called for increasing shared revenue by 4% over the next two years. 

Republicans have pushed to lower taxes for families and residents of Wisconsin consistently. Yet, on the other hand, Evers has not only proposed hiking taxes for over $1B for Wisconsin’s hard-working families, but he has also tried to take credit for Republican proposals that led to one of the highest tax cuts in WI history. 

Evers 2019-2021 budget proposal was immediately trashed after the WI Legislature saw it. So they instead created their own plan, which included a dramatic $3B tax cut and spent $3.7B less than what Evers had initially proposed. The Governor didn’t like that his initial idea was shot down and called the Republican’s budget “paltry” and “an insult.” He also threatened to veto it entirely and start over. 

Although, he did not veto it. Instead, he made a few minor changes to the budget before signing it. He immediately claimed he was responsible for it.

“I am providing more than $2B in tax cuts and cutting taxes for middle-class families at a time when our economy and families need it most,” he stated as he patted himself on the back. That’s when a reporter asked Evers how he could take credit for a plan he adamantly opposed. Evers arrogantly replied, “I could have vetoed that.” 

Right now, when families are struggling to afford to put food on the table, they don’t need bureaucrats playing games. Evers is either for the people or against them; he can’t be the knight in shining armor and the fire-breathing dragon. This budget surplus is a great time to show Wisconsinites that he is working for them and not against them with a hefty tax cut that can benefit all. 

Compromises in the Future

Evers will need to start being more receptive to Republican ideas to make this a successful and productive term. The red and blue must try to see eye-to-eye and work together to improve Wisconsin. The Republican-controlled Legislature expects to see compromises and reform in various areas. 

Vos said he would compromise on additional public school funding if Gov. Evers cooperates with him on universal school choice/vouchers. Vos also mentioned being willing to amend state law to include instances of rape/incest regarding abortion eligibility instead of eliminating the law altogether. 

Republicans display their open-mindedness and willingness to work with Evers during his second term. However, we will have to see how willing the Governor is to reciprocate those efforts and work with the GOP so that the two parties can strike a balance that favors Wisconsinites.