Last week, our friends from the Wisconsin Club for Growth noted that:  “An important key to realizing the benefits of pro-growth policies is that first, the economy expands and then tax revenues flow, not the other way around.”

That bore repeating because, “some legislators are scheming to tax prospective mining operations before they generate any proceeds.”

The ploy is to levy taxes before any ore is produced and use the proceeds to train union workers—for the mining jobs whose creation the tax will most likely prevent. The “reasoning,” to use an excessively charitable word, is that the mines will become union shops because operators won’t want to spend money on training if they’ve already paid taxes for it.

But that was not the only cash grab floating around the Capitol:

Other misguided legislators are angling to replace the current tax on net mining proceeds with a gross tonnage tax, imagining this will benefit mining companies. It might, if the economy was roaring and demand was high. With today’s sluggish economy and thin profits, it makes the mere thought of launching an enterprise look foolhardy.

As it turns out some those “misguided legislators” playing around with the idea of a new “tonnage” tax are Republicans. Sources say that a group of GOPers, including senators Luther Olsen, Mary Lazich, and Frank Lasee and several others, have expressed support for the new tax. They are getting significant pushback from other conservative senators, including newly elected Senator Tom Tiffany, who was elected on a pro-mining platform.

Says one insider:

I'm told that Tiffany told the caucus he didn't run to raise taxes on companies investing in jobs. [Paul] Farrow wins the Republican Reality Award for pointing out to the Republican caucus that last session they passed a 2/3 vote to raise taxes bill to stop future Democrat leaders from raising taxes. It is a real concern. Wonder what the Governor would do with the chance to veto his first tax increase.

Why the interest in the tonnage tax? Apparently some of the senators think it will generate more revenue faster for the state. 

So another reminder is in order: the priority should be creating jobs, generating investments, growing the economy… not feeding the coffers of government. Priorities, people.

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UPDATED:

Dear Charlie,

I do not nor have I ever supported a tonnage tax on mining. As a sponsor of Senate Bill 2 (SB 2) and its companion bill Assembly Bill 2 (AB 2), I do not support taxing any businesses out of Wisconsin. The mining bill is about creating jobs all over Wisconsin and getting Wisconsinites back to work not creating more government red tape.

I hope this clears up any misunderstanding about where I stand on a tonnage tax on mining in Wisconsin.

Sincerely,

State Senator Mary Lazich