With the eighth highest individual income tax rate in the country – and one of the worst in the Midwest – Wisconsin is falling behind other states in the competition for both employers and workers.
“From 2010 to 2020, the top 10 states that had the largest percentage of 18-34 year-old population growth had an average 2023 tax rate of 2.3%,” said WMC Director of Tax, Transportation & Legal Affairs Evan Umpir in WMC’s latest Two Minute Drill video. “[Wisconsin] must take steps to remain competitive and distinguish itself as a premier state to live, work and raise a family.”
A recent report released by WMC Foundation notes that Wisconsin is not remaining competitive with other states, resulting in a demographic dilemma. According to the data, there are not enough people living in the state to fill available jobs and the size of the future workforce population is shrinking. To combat this unfortunate trend, the report details how low- or no-tax states are rapidly attracting workers and growing population – suggesting Wisconsin could use tax reform as a tool for talent attraction.
Rusty Schieber, Vice President of Operations at Brakebush Brothers, Inc., argues that Wisconsin’s high income tax rate handicaps the economy.
“Income taxes simply take money out of your pocket,” he explains in the video. “If you’re a business, that’s less money that can go into employee wages. It’s less money that can go into employee benefits. It’s less money that can go into capital expansion that can grow your company in future years.”
As other states continue to make significant and bold changes to their tax codes, Wisconsin cannot afford to sit on the sideline.
“In order to remain competitive as a state, we have got to be paying attention to our competition,” adds Schieber. “We need to continue to be a place that is driving economic development, incentivizing people to move into our state and decreasing incentives for people and businesses to leave our state.”
