October 30, 2014

Tax cut outlines taking shape

The outlines of a state income tax cut are taking shape. Governor Scott Walker said over the weekend that he expects the tax cut, to be included as part of his state budget, to total some $342 million, or about $200 for a typical middle-class family. Assembly Speaker Robin Vos said Tuesday that $300 to $350 million over two years seems a reasonable goal. “I hope that’s a low end of the number,” said Vos. “Obviously if we have an opportunity to have a bigger surplus because our reforms are working, or the revenues are coming in greater than expected, hopefully we’ll be able to expand that.

Walker said a projected state surplus ought to be returned to taxpayers. “We think it’s reasonable to focus in on the surplus. The surplus is $342 million, and the taxpayers obviously were at the forefront of making that possible,” said Walker. “We still have a few more weeks to work out the kinks in terms of the budget, but I think the Speaker’s talking in realistic terms.”

AUDIO: Bob Hague reports (:65) 

Walker said he wants the cut to go to middle class families, which he defined as those earning between $20,000 and $200,000 a year. “The low end is very low compared to other states. The top brackets, while it’s high, it’s still not tremendously higher, or at the high end of other states,” said Walker. “Where we get nicked the most, is in that mid section, the mid tax rates. And so it’s both looking at targeting tax relief there, as well as looking the possibility of maybe tweaking a few of those tax rates.”

Vos said yet to be determined is how the cut will be implemented – either by changing state tax withholding tables immediately, or by allowing the cut to tax effect when taxpayers get their refunds in the spring. “There’s no doubt that there’s room for a tax cut,” he said. “That is one of the main priorities that we have.”