Raising sales tax in Milwaukee city and county; what would it cost you?

MILWAUKEE - Milwaukee leaders will have the power to raise a local sales tax. That is if the shared revenue deal in Madison becomes law. 

Could a higher Milwaukee sales tax drive people to buy cars in other counties?

"It absolutely will not. It will not. And it’s for a very simple reason: you pay sales tax where you live. So If you live in Superior, Wisconsin, you pay sales tax on that vehicle, even if you bought it in Milwaukee, at the rate you would pay for in Superior, Wisconsin," said Jim Tolkan of the Automobile Dealers Association of Metro Milwaukee.

Milwaukee's car dealer organization does not think the extra sales tax will hurt business. 

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"Let’s say you’re financing it, what difference does it make $900 over 5 or 6 years?" Tolkan said. "The problem really comes with those asking, can I afford to buy a car at any price, yes or no?

In Milwaukee's Historic Third Ward…

 "Right now a lot of visitors are like, your sales tax is low," said Jeanette Dvorak, Mainstream Boutique/Access Boutique.

And that is if they even notice it at all.

"We do have a lot of travelers and visitors in here and the last thing they ever ask is about the sales tax, so that doesn’t concern me at all," Dvorak said. 

Dvorak runs two boutiques, but does not think a higher sales tax will hurt her businesses. 

"I think right now, no matter where you are traveling from or locally, you don’t always know the sales tax in different area," Dvorak said. 

Before those new taxes go into effect, both the Republican Legislature and Democratic governor need to sign the shared revenue deal. Then the Milwaukee Common Council and Milwaukee County Board would have the power to up these sales taxes. 

Legislative leaders estimate Milwaukee County would get $76 million a year with the new tax – and the city would get $184 million a year. City leaders say that will help save them from a fiscal crisis – which the mayor said would lead to devastating cuts. 

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There are strings though. The city will have to do things like not use tax money for the streetcar, and have Milwaukee Public Schools hire 25 resource officers. 

Joint statement on sales tax agreement

From members of the Milwaukee Common Council: Milele Coggs, Mark Chambers, Jr., Russell Stamper, II, Larresa Taylor, Andrea Pratt, Khalif Rainey, and Lamont Westmoreland

Milwaukee is the economic engine of Wisconsin, and as such we are deserving of our fair share of the revenue we produce, so it was good to see movement in that direction yesterday. But there is nothing to celebrate with the overreaching, micromanaging, and frankly racist nature of many of the policies embedded in the "groundbreaking" deal.

After the world watched George Floyd beg for his mother, and take his last breaths while a police officer had his knee on his neck, we acted in Milwaukee, a city that by most social indicators is the worst place for Black people to live in the nation. We created the Office of Equity and Inclusion, as well as adopted several resolutions urging the Fire & Police Commission (FPC) to create countless policies that attempt to ensure that situations like what happened to George Floyd do not happen here. The policies the State has embedded into the shared revenue agreement encroach upon local control, and destroy much of the work we have done while handicapping Milwaukee’s ability to address the historic inequities that still exist.

Among the detrimental and troubling policies in the bill are: The city would be prohibited from using the revenue to fund positions to promote diversity, equity and inclusion, as well as being prohibited from using race as a factor when issuing contracts; Fire and police policy-making power would move from the independent FPC to the respective chiefs; The city may not use the new money on what one Assembly leader believes is "frivolous things such as street cars and woke diversity and equity initiatives," and any new spending would require a two-thirds vote of the Council.

These are just a few of the policy changes the State is on the verge of passing as the state aid deal gets approved. We encourage those interested to read the entire bill to prepare themselves for all that is to come.  The Assembly bill can be viewed in its entirety at: https://docs.legis.wisconsin.gov/2023/proposals/ab245.

While an increase from the years of stagnation in shared revenue is warranted and appreciated, as is the ability to implement a sales tax, the proposed 2% sales tax does NOT save us from debt.

The city will still be in debt and have to make budgetary cuts regardless. While admittedly the legislation will lessen our debt tremendously, the combination of policy provisions attached is a death blow to our efforts to improve the quality of life for some of our city’s most marginalized citizens.

A deal of this magnitude deserves thorough deliberation and research, and the citizens of Milwaukee need transparency. The recent Steering and Rules Committee meeting where the Mayor instructed his staff not to appear and answer questions of Common Council Members further inhibits citizens from the truth of what is going on. We do not support taking the voice away from the people we represent, and believe they deserve the truth and have a right to weigh in on any decisions being made considering the many implications and damage this may cause this city.

We remain committed to addressing inequities, public safety challenges, and our financial condition with transparency, thorough research, and a level of empathy that the authors of this legislation did not have.  As we approach a likely vote about the sales tax, the thoughts and opinions of residents who will bear the burden of the sales tax will be at the forefront. We encourage those with questions or concerns to contact their representative to share their opinion.