Vos says he’s open to negotiations with Evers on funding middle-class tax cut

Photo by Michelle Stocker, The Capital Times

Assembly Speaker Robin Vos says he “would definitely be open to” negotiating with Gov. Tony Evers about how to fund a middle-class tax cut.

But the Rochester Republican continued to rule out a tax increase being part of the equation as Evers knocked the GOP version of the plan as “fiscally irresponsible.”

Both sides continued to dig in over how to pay for their shared goal of a middle-class tax cut as the Joint Finance Committee Thursday approved along party lines the GOP’s version.

As Dems complained Republicans were forging ahead without bipartisan support on how to pay for the tax cut, JFC Co-chair John Nygren argued ahead of the hearing that Republicans had already compromised. The Marinette Republican said that’s because they were taking cues from Evers on how to target tax cuts to the middle class rather than doing the broader relief some GOP lawmakers preferred.

Republicans want to use the projected $691.5 million gross balance in the general fund at the end of the current fiscal year to cover the costs of their tax cut over the 2019-21 budget.

Evers and Dems, though, have objected to using one-time money to cover the cost of an ongoing obligation. They have proposed capping a tax credit for manufacturers to help cover the price tag of their plan, which Republicans have called a non-starter.

Nygren told reporters the only hangup was how to pay for the tax cut.

“That is a significant movement on our part already,” Nygren said. “I would ask where has Tony Evers moved on the tax cut?”

Evers spokeswoman Britt Cudaback fired back the guv was serious about providing “real, responsible tax relief” and noted he ran on a plan that included capping “handouts to millionaires” to pay for it.

“Introducing a competing proposal that uses one-time funds and leaves taxpayers on the hook for millions of dollars in the future it isn’t compromise, it’s just fiscally irresponsible,” Cudaback said.

During the hearing, Dems urged Republicans to hold off on their standalone bill, which passed 10-3, and instead debate the tax cut in the context of Evers’ budget, which will be released in three weeks.

Under the GOP plan, the state would see reduced revenues of $152.1 million in the first year of the upcoming budget as withholding changes were changed to reflect the cut. It would then be a reduction of $343.5 million in the second year of the budget.

The state expects to have $2.4 billion in additional revenue to spend through mid-2021, meaning the GOP plan would drop that to $1.9 billion.

The GOP plan would result in a tax cut for nearly 2 million filers with an average reduction of $170 for those seeing a reduction.

While open to negotiating with Evers, Vos ruled out paying for the cut through a different tax increase.

“If the idea would be they have a different funding mechanism, they want to take it out of GPR, I wouldn’t be opposed to talking about that,” he told reporters after a Rules Committee meeting Thursday. “That’s not a nonstarter.”

The Assembly is planning to take up AB 4, the GOP proposal to increase the standard deduction on a sliding scale, when the chamber convenes on Tuesday. The plan runs counter to a version from Evers and Dems that would create a new nonrefundable tax credit and increase the state-level credit recipients get under the federal earned income tax credit.

Vos and the guv met Wednesday, but the two didn’t talk about the competing tax cut plans, Vos said.

Hear the audio of Vos speaking with reporters here.

Subscribers can read more about the JFC meeting at the Budget Blog.

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