Wisconsin Governor Scott Walker will propose using the vast majority of the state's $912 million revenue windfall to cut property and income taxes, his office announced Wednesday morning.
"The taxpayers helped build this surplus and they should be able to keep more of their paychecks and more of their hard-earned money," the governor's office said early Wednesday. "Governor Walker also wants to make targeted investments in worker training and education to make sure Wisconsinites have the skills necessary to get the available jobs in our state."
Walker noted that if his tax cut package is passed, the total tax relief provided under Walker will total roughly $2 billion.
Walker's tax cut plan would:
Put more than $800 million back into the hands of taxpayers through property and income tax cuts and withholding changes.
Reduce property taxes by over $406 million—more than four times larger than the property tax relief we passed last year...The average homeowner will see a reduction of $101 dollars on their next property tax bill.
Reduce income taxes by nearly $100 million—all of which would go into reducing the lowest income tax bracket from 4.4 percent to 4.0 percent. Whether you are a family making $40,000, $50,000 or $100,000, you will save about $58 per year.
Reduce withholding tax for state income taxes by $322.6 million—this will let Wisconsinites keep more of their paychecks. It will put more money in the hands of consumers and will continue to stimulate the economy. A typical family of four will see about $58 more in their paychecks each month.
Walker said he is proposing reducing property taxes by $406 million by buying down the mill rate for the technical college levy. According to Walker, the state will buy down the technical college levy by reducing the mill rate 0.89. Walker said the mill rate reduction is the same across the state and therefore will result in equal reductions statewide. Walker said it is estimated to reduce property taxes $101 on the median value home of $151,000.
Walker said he is proposing to reduce income taxes by compressing the bottom tax bracket. The bracket would reduce from 4.4% to 4.0%. Walker explained that this is a savings across the board because everyone goes through the bottom bracket resulting in a savings of between $44 and $58 depending on whether the taxpayer is an individual, married filing jointly, or married filing individually. The rate change would be effective in the 2014 tax year.
Finally, Walker said he is directing Department of Revenue Secretary Chandler to adjust withholdings, resulting in a reduction of $322.6 million over the biennium. Walker said the change would result in an increase of $57.90 per month for a family of four, or $521.10 per year. The effective date of the change would be April 1, 2014.
You can follow the Governor's State of the State address at the RightWisconsin Live Blog, beginning at 6:45 pm this evening. The speech begins at 7 pm and our live coverage will run continuously throughout the address. We'll have real-time commentary from Charlie Sykes, the RightWisconsin editorial staff and nearly a dozen insiders and pundits from across the state. You'll have an opportunity to participate in the discussion, too. See photos and videos from the Capitol, vote in instant opinion polls and more. Check back in with RightWisconsin beginning tonight at 6:45 for our live coverage.