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WCA's Cost-Benefit Analysis of No Tax on Tips & Overtime
The group for Wisconsin’s county governments is out with a warning about the cost of ending taxes on tips and overtime. But they are, so far, silent on the cost of ending Act 10.
Forward Analytics, the Wisconsin County’s Association’s research arm, released a study this week on the benefits of ending taxes on tips and overtime.
“A ‘no tax on tips’ policy would put more money back in the pockets of many Wisconsin workers, and it would also carry a real cost to the state,” Forward Analytics researcher Jacob Anderson said. “Lawmakers should weigh both sides and clearly outline who stands to benefit. There may be unintended consequences if the policy is not thoughtfully considered before enacted.”
Republican candidate for governor Tom Tiffany has said he wants to end Wisconsin’s income taxes on tips and overtime, just like President Trump did at the federal level.
The Forward Analytics study puts the price tag for ending taxes on tips and overtime at $2.7 billion lost over a decade.
But the Counties Association and Forward Analytics have not released any reports about the $2 billion in costs to taxpayers that would come with the end of Act 10.
The Wisconsin Institute for Law and Liberty said ending Act 10 would cost $2 billion a-year, every-year.
“As Wisconsin courts consider the future of Act 10, WILL’s previous research has shown that repealing Act 10 could cost taxpayers over $2 billion each year,” WILL wrote last year.
That includes about $480 million in new costs for local governments, like Wisconsin’s counties.
“Act 10 has been a win for Wisconsin taxpayers, slowing the growth of government and the constant threat of massive property tax hikes," WILL's Will Flanders added. "Without it, taxpayers could be on the hook for billions in tax increases in the coming years. School districts and local governments could once again be pressured to cater to public-sector union demands, leaving hardworking taxpayers to shoulder the burden of skyrocketing costs.”
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