The Tax Reform Traveling Show made a stop in Platteville Thursday morning.
Lt. Gov. Rebecca Kleefisch and Richard Chandler, secretary of the state Department of Revenue, held a forum on proposals to reform state taxes at UW–Platteville.
The forum drew an audience that included business people, farmers, elected officials and economic development professionals.
“We’re going to be asking everybody in the state of Wisconsin who pays taxes, including those who may be paying taxes — students — to contribute their thoughts,” said Kleefisch.
Thoughts at the forum included which taxes should be cut, Wisconsin taxes in comparison with other states’ taxes, as well as taxes to increase in order to reduce other taxes. The subject of jobs and keeping people who grow up in Southwest Wisconsin here also came up, as well as what services government provides and funds.
The forums were scheduled after Gov. Scott Walker suggested eliminating state income taxes late last year, and with a projected surplus of more than $900 million in the current fiscal year.
The forums are being held in a state with the 10th highest taxes in the U.S., 9 percent more than the national average, according to Chandler. He also cited statistics showing Wisconsin as having the 10th highest property taxes, 12th highest income taxes, 18th highest business taxes, 30th highest fees and 35th highest sales taxes in the U.S.
While the forums were created in part because of Walker’s proposal to eliminate income taxes, Kleefisch said, “A lot of people have said that the property tax bothers them the most.”
“Property taxes come up pretty quickly” when people discuss relocating to Wisconsin, said Melissa Pahl of the Platteville Area Industrial Development Corp.
Pahl said property taxes in Chicago are similar to Wisconsin property taxes. She said there are a “pretty large number of jobs available in the area; we can’t attract talent, and one of the issues can be property taxes.”
Chandler said per capita property taxes total $2,938, while per capita income taxes total $1,304. Chandler said the state income tax represents 53 percent of state general fund revenues. The property tax represents 39.7 percent of state and local tax revenues.
Philanthropist Cindy Tang favored eliminating “or at least major reform” of income taxes to “eliminate complex and politically motivated tax breaks.”
Developer Jim Schneller said most tax experts “would rather have a broader base and lower rates” by eliminating exemptions to, for instance, sales taxes, though eliminating exemptions are “much harder politically” to eliminate.
“We’ve gone from a goods economy to a service economy, and a lot of services aren’t taxed,” he said.
“I’d love to lower property taxes, but I don’t want to see us put strain on schools,” said Pahl.
Grant County Board chairman Larry Wolf said the only way to increase the tax base is “good-paying jobs. … We’re funding the Iowa tax base. We have a large amount of tourism in Wisconsin; we need to take advantage of that.”
Mound City Bank president Donna Hoppenjan, whose bank has an office in Mount Horeb, said that “a lot of people that grow up here migrate to Mount Horeb, Verona, Madison, if not Milwaukee, because of the opportunity for jobs.”
“The challenge I have is how you attract the best and the brightest,” said Steve Ungs of Avista in Platteville. Ungs said potential employees from outside Wisconsin look at the state’s income taxes, which affects Avista’s ability to hire them.
Pahl said improving jobs requires “boots-on-the-ground economic development work, and I’m concerned with how we fund that.” She said Iowa state law mandates a percentage of tax revenues be used for economic development.
“Southwest Wisconsin really does need support for economic development,” said Tang.
“The state needs to think of this as a long-term investment, not a short-term expense,” said Schneller.
At the same time, speakers pointed out the economic-development incentives, or lack thereof, Wisconsin offers compared to other states.
“You want to have a good environment for the people who are making job decisions,” said Chandler afterward. “A lot of states are playing that game, and if you’re not at least going to try to match them, that’s a negative.”
Wolf also said transportation needs more funding: “We’ve got to go back to some way” to increase transportation tax revenues, possibly by reinstating gas tax indexing.”
Lancaster Mayor Jerry Wehrle asked if, similar to county sales taxes, cities would be allowed to assess sales taxes.
Any tax reform would be part of the 2015–17 state budget, which would be created following the 2014 elections, when Walker, all of the state Assembly, and 17 members of the state Senate, including the 17th Senate District now represented by Sen. Dale Schultz (R–Richland Center), are up for reelection.
Schultz has not announced whether he’s running for reelection. Rep. Howard Marklein (R–Spring Green) and Democrat Ernie Wittwer of Hillpoint are running for the 17th Senate District seat.