MADISON, Wis. — Reporting from Urban Milwaukee slams Tom Tiffany for championing tax breaks that disproportionately benefit the wealthy — according to the story, more than 89% of the tax credit went to those making half a million or more and nearly 46% went to those making $5 million or more. A study found that Tiffany’s tax break turned wealthy people getting the tax credit into “free riders.”Urban Milwaukee: Tiffany Pushes Tax Break That Mostly Helps Wealthy
By: Bruce MurphyThe Manufacturing and Agricultural Tax Credit was passed by Republican Gov. Scott Walker and Republican legislators in 2011. Tom Tiffany, then a state representative, voted for it. He is now championing it in his race for governor.The credit was quietly added to the huge state budget at the last minute with no public notice or debate and paid for with large cuts to education and other programs. It wasn’t applied until 2013 and had a three-year phase-in, so the tax credit’s full impact wasn’t known until 2016, five years after it was passed. In 2018, the nonpartisan Legislative Fiscal Bureau did an analysis of its impact, which showed it skewed heavily toward the wealthy: More than 89% of the tax credit went to claimants with an income of $500,000 or more and nearly 46% went to those making $5 million or more.You could hardly find a tax credit more perfectly calibrated to benefit the rich.The tax credit had by then cost an estimated $1.4 billion in lost tax revenues, “reducing the resources available for investing in Wisconsin’s families, schools and communities,” noted an op-ed by Wisconsin Budget Project analyst Tamarine Cornelius. Evers’ proposal “would allow manufacturers to use only the first $300,000 of income to claim the credit,” with more than 90% of the revenue gained coming from millionaire taxpayers.In 2019, Thompson did his own analysis, using a far more sophisticated approach by tracking average job growth in Wisconsin and comparing it to growth in these four states and two others from 1990 to 2018, and found Wisconsin’s growth tracked almost exactly compared to neighboring states before and after the tax credit. Nothing had changed.The main impact of the tax, his column noted, was to turn those wealthy people getting the tax credit into “free riders,” who “continue to benefit from the state services funded by other taxpayers, while paying little towards their cost.”That was seven years ago, and CROWE never offered any new analysis until Tiffany’s entrance into the race for governor. Last week, it released a study that simply dusted off the same threadbare methodology, comparing job growth in Wisconsin border counties with contiguous counties in those same four states it used in 2017. The report doesn’t address any of the problems Thompson identified with this approach or his research showing zero impact on job growth.In between the release of the report and Bauer’s op-ed, Tiffany toured Vincent Tool Technologies in Chippewa Falls, touted the Manufacturing and Agriculture Tax Credit What Crowley has said about taxes is that he wants a comprehensive review of the state revenue system with a view to reducing property taxes. When asked where he stands on the Manufacturing and Agriculture Tax Credit, Crowley offered this statement to Urban Milwaukee:“Wisconsin needs a fair tax system with incentives and credits for companies that create good-paying jobs. But bosses and businesses also need to share in the tax burden, not just workers and homeowners. When elected, I’ll form a Blue Ribbon Commission of Democrats, Republicans, businesses, labor leaders, and tax experts to recommend a balanced, fair tax system.”Considering the Manufacturing and Agriculture Tax Credit costs the state about $330 million in lost taxes per year, or about $3.3 billion over the past decade, such a commission would have to consider what we are actually getting for that money. |
