Assembly OKs GOP tax cut legislation, sends plan to Senate
MADISON — Wisconsin Republicans moved closer Tuesday to sending their middle-class tax cut plan to Democratic Gov. Tony Evers’ desk, pushing the legislation through the state Assembly and on to the Senate.
The Assembly passed the measure 61-33 despite Democrats’ complaints that the plan relies on the state budget surplus to backfill the lost revenue. Senate Republicans are poised to vote on the legislation as early as Wednesday.
The bill calls for using the surplus to pay for a $340 million annual tax cut for middle-income single and joint filers. The maximum deduction would increase 20.6 percent for single people making less than $127,000 and joint filers making less than $155,000. The average cut for all filers would be $170, according to the nonpartisan Legislative Fiscal Bureau.
But the proposal appears destined to die on Evers’ desk. The governor is eyeing the $616.5 million surplus as he crafts the 2019-21 state budget and has unveiled his own plan to cut taxes by about $415 million per year and expand the earned income tax credit. The governor’s office says the average cut under his proposal would be about $225.
He would pay for half the cut by capping tax credits for manufacturers. He hasn’t said how he’d fund the rest of his plan, but has called using the surplus irresponsible. The tax-cut concept should be part of a larger debate on the upcoming state budget, he said.
“I want to see if it passes and what condition it is in, but I can’t personally understand how we could possibly use up all the surplus for this and then essentially ignore the rest of the budget,” Evers told reporters Tuesday.
Republicans painted themselves as bipartisan compromisers during the Assembly floor debate Tuesday. They noted Evers ran on cutting taxes and said they’re trying to meet him halfway. They blasted him for proposing manufacturers pay higher taxes.
“There is no way we are ever going to agree to an increase in taxes,” Speaker Robin Vos told reporters before floor debate began. “If you insist that’s the only way the tax cut will be funded, you’re being disingenuous with the public because that’s never going to happen.”
They acknowledged that no one can project whether the surplus will exist in future years but they predicted economic growth will continue, ensuring the state can afford the tax cuts in the future.
“This is a perfect plan for helping folks in the middle class while at the same time protecting … manufacturing,” Rep. Patrick Snyder, a Republican from Schofield, said on the floor.
Democrats pushed back, accusing Republicans of trying to overshadow Evers by putting their plan out ahead of his. They said Evers recognizes that people who make more money should pay more in taxes.
“What Republicans are proposing simply isn’t going to become law,” Minority Leader Gordon Hintz told reporters before debate began.