The 2009-2011 state budget created a new income tax bracket for individuals who make more than $225,000 per year and married couples who make more than $300,000. The richest Wisconsin residents will now be taxed at a rate of 7.75%, which is one percentage point higher than the previous top tax bracket.
Capital gains, the income generated from the sale of stock, real estate or other nonproductive assets, are treated more favorably under Wisconsin tax code than income earned through actual labor. Prior to the current state budget 60% of capital gains income was exempt from state income tax.
The most recent state budget reduced the capital gains exemption to 30%. (Gains made from the sale of a primary residence are still excluded, up to $500,000.)
“It is a matter of basic fairness that income from wages and capital gains should be treated equally for tax purposes. This budget was a step in the right direction,” says Phil Neuenfeldt, Secretary Treasurer of the Wisconsin State AFL-CIO. “41 other states apply their income tax to 100% of capital gains. In other words, Wisconsin was losing out on a common source of revenue."
In addition to the progress made through the budget, the Wisconsin State Legislature also closed the so-called “Las Vegas Loophole” which allowed corporations dodge taxes by setting up subsidiaries in states without a corporate income tax. 80% of Wisconsin banks took advantage of this dodge, and prior to the new combined reporting requirements 62% of corporations that made profits in Wisconsin paid no corporate income tax whatsoever. It is estimated that the stricter law will bring $215 million into the state’s general fund in each two-year budget cycle.
“We have more fairness in our tax structure today, because we elected working family candidates in 2008,” says Secretary Treasurer Neuenfeldt. “In 2010 we must continue to turn out the vote for politicians who will make corporations and the rich pay their fair share towards strong, stable public structures.”
While those who can afford it will be taxed at a higher rate, middle-class working people in Wisconsin actually received some significant tax breaks over the past two years. Click here to read our previous blog post on fair taxation.
For more information about improvements in our tax code and other victories during the 2009 -2010 Legislative Session, click here to read a detailed legislative report.
(In the photos above AFSCME Council 48 members protest the proposed Milwaukee County budget outside of a listening session held by County Executive Scott Walker. If Walker becomes our next Governor, all of the progress towards a fair tax code that has been made over the past two years will be in jeopardy. Photos taken on May 10, 2010 by Dominique Noth. For more pictures of the listening session protest, visit http://www.flickr.com/photos/wisaflcio/sets/72157623917045015/.)
gucci vintage web medium boston bag brown Election Day Made a Difference: Fair Taxes Support Public Structures and Vital Services - Wisconsin State AFL-CIO Blog
Posted by: so kelly bag hermes | 01/22/2014 at 09:50 PM