Gov. Walker wants to eliminate state income tax and/or property taxes (Milwaukee: 2015, school)

[MaseMan]

OK, I'll way in on the topic I started.

As a homeowner and small business owner, no property taxes or state income tax would be a huge windfall to me. I mean, several thousand dollars a year. I could take that and easily absorb a hike in sales tax and other fees, and would likely come out way ahead.

That said, I fear this plan would shift a huge burden to the lower and middle class. Obviously, we don't have enough info to make a full determination. Would there now be a tax on food? How much taxes on commodities like gasoline go up? The percentages could sound like chump change at first, but for someone at the poverty line, they could be the difference between barely making it, or having to rely even more on government welfare programs.

[Ragnar]

Originally Posted by MaseMan

That said, I fear this plan would shift a huge burden to the lower and middle class. Obviously, we don't have enough info to make a full determination. Would there now be a tax on food? How much taxes on commodities like gasoline go up? The percentages could sound like chump change at first, but for someone at the poverty line, they could be the difference between barely making it, or having to rely even more on government welfare programs.

True. This is always a concern. One thing we could do is keep the sales tax from hitting necessities like food, clothing, diapers, infant formula, etc. I moved here from PA and that's what PA still does.

Of course it's strange to shop at a high-end clothing store like Macy's and pay no sales tax on the expensive clothing sold there. So it's not just the poor who would benefit from no tax on clothing.

[MaseMan]

Originally Posted by Ragnar

True. This is always a concern. One thing we could do is keep the sales tax from hitting necessities like food, clothing, diapers, infant formula, etc. I moved here from PA and that's what PA still does.

Of course it's strange to shop at a high-end clothing store like Macy's and pay no sales tax on the expensive clothing sold there. So it's not just the poor who would benefit from no tax on clothing.

I think I'd be OK with that. Clothing is an essential...it seems like not taxing it would be reasonable. The delineation between high end and "regular" clothing is pretty fine, so drawing a distinction would be hard.

[sholomar]

south dakota has no state income tax and I pay about $55 to register plates... but you get a lot more services and things in WI for your money. All the roads here are gravel, there's not really much out here. There is a sales tax on food to make up for it somewhat. Plus in general wages are higher in WI. With a few exceptions, you'd probably make that money back and live in a much more desirable area. I happen to be one of the exceptions, so I'm out here.

If a bunch of people suddenly found the state desirable and they moved there, that would just lead to them instituting a state income tax anyways. It almost happened once in the past and was barely defeated. Luckily South Dakota doesn't do anything that rich people would find attractive that California, Colorado, Montana, or other states don't already do better.

[trailerguy]

Originally Posted by MaseMan

"Say the sales tax -- we are blessed with the fact that in this state, compared to many of our neighbors in the Midwest, property and income tax are relatively high, but sales taxes are some of the lower ones in the Midwest. Potentially you could see an increase there if you eliminated something like the income tax or a major chunk of the property tax."[/i]

Thoughts?

This is a major income shift in line with current Republican philosophy. Income and property taxes affect higher income people, income tax because they have higher incomes, and property taxes, because rich people usually have more valuable houses. But sales tax hits everyone, and disproportionately the poor and working poor, because they spend pretty much every cent they get to survive. So you shift the tax burden away from the rich, for whom sales tax is small change, to the poor and near-poor, where it is a major burden. In addition, he is going to continue to slash benefits and public services which are useless to the rich and critically important to the poor. And they are going to feed us the lie that a minute portion of this saved wealth is going to "trickle down" on us. It won't. Anyone less than a millionaire who votes for this jackal is a fool.

[trailerguy]

They will tax everything. They will have to, in order to cover the loss of income and property taxes. This governor and legislature do not care how it affects poor and working class people. They are not serving them. They are currently changing the voting rules to disqualify as many poor and minority people as possible to maintain the plutocracy that Wisconsin has become.

[timberline742]

Originally Posted by trailerguy

This is a major income shift in line with current Republican philosophy. Income and property taxes affect higher income people, income tax because they have higher incomes, and property taxes, because rich people usually have more valuable houses. But sales tax hits everyone, and disproportionately the poor and working poor, because they spend pretty much every cent they get to survive. So you shift the tax burden away from the rich, for whom sales tax is small change, to the poor and near-poor, where it is a major burden. In addition, he is going to continue to slash benefits and public services which are useless to the rich and critically important to the poor. And they are going to feed us the lie that a minute portion of this saved wealth is going to "trickle down" on us. It won't. Anyone less than a millionaire who votes for this jackal is a fool.

[MaseMan]

My guess is this will pass this coming year. Walker will be re-elected and then we will see Wisconsin become a "Right to Work" state.

[wutitiz]

I'm in Washington State where we don't have any state income tax. Sales tax is almost 10% (varies by locale) and property tax is fairly high.

There was a ballot measure to enact an income tax in 2010, Initiative 1098, led Bill Gates Sr. father of the founder of Microsoft. Here in WA, any citizen can propose legislation, collect signatures in support, and have it put on the ballot. It was supposed to apply only to the very wealthy. It lost 65-35. We are a solidly blue state (Obama 55.9, Romney 41.7), but voters tend to have a libertarian streak on ballot measures.

Not having a state income tax is a huge boon for the economy, IMO. It has helped attract and hold many tech sector jobs, to everyone's benefit. Overall taxes are still high. WA tax freedom day is 9th latest among the 50 states. However the taxes can be avoided to some extent by behavior. Income tax, for most people, can't be avoided. If you work, you pay. Exceptions may be the super rich with their armies of lawyers and accountants.

BTW Wisconsin is currently exactly tied with WA at 9th place on the tax freedom day list.
Map: Tax Freedom Day by State, 2013 | Tax Foundation

If you can jettison your state income tax, I'd say go for it. Lack of income tax covers a multitude of other economic sins. No matter how bad Olympia (our state capitol) has screwed things up, our lack of income tax has saved our economy.

[timberline742]

Originally Posted by MaseMan

My guess is this will pass this coming year. Walker will be re-elected and then we will see Wisconsin become a "Right to Work" state.

What does anyone see in that man? I don't know one person still in WI that supports him, even among the more conservative types (don't know many, but once a couple of frac sand mines popped up and they lost local control over them, even they jumped ship). Who likes him? Taxes aren't being reduced. The economy or education isn't getting better under him. It doesn't make sense.