GOING DOWN: Gov. Scott Walker holds a chart showing how much property taxes have dropped for a typical homeowner in Wisconsin after the GOP-led Legislature approved close to $800 million in tax cuts.

By Adam Tobias | Wisconsin Reporter

MADISON, Wis. — Wisconsin has been recognized by the American Legislative Exchange Council as the leader in tax cuts in the 2014 legislative session.

Some say that achievement will be noticed by most property owners when they pay their tax bills this winter.

Republican Gov. Scott Walker and the GOP-led Legislature helped Wisconsin beat out 13 other states that made “significant, broad-based tax cuts” this year by slashing nearly $800 million in taxes, Jonathan Williams, director of ALEC’s Center for State Fiscal Reform, told Wisconsin Reporter.

The Badger State, which began the 2014 legislative session with a budget surplus of $911 million, led the way by cutting $504.6 million in property and income taxes and adjusting state income tax withholding by $322.6 million, according to a study authored by Williams and other ALEC staff.

The property tax cut of $406 million is more than four times larger than Wisconsin’s previous property tax reduction and will decrease the average homeowner’s property tax bill by $101, the report says.

State taxes have been cut by about $2 billion since Walker took office in 2010, thanks in large part to Act 10, his signature collective bargaining reforms prohibiting the forced unionization of most public-sector workers.

“Today, a typical homeowner will have a lower property tax bill in 2014 than they did in 2010,” Walker said in a news release. “By putting more money back into the hands of the hard working taxpayers, they can continue to invest that money into our economy. That is why I’m committed to continued property tax reform so property tax bills in 2018 will be even lower than they are today.”

Prior to 2010, property taxes on a median value home increased 27 percent over the past decade, according to Walker’s office. Those rates have declined each of the past four years, resulting in $800 in savings for an average Wisconsin family compared to the previous four-year trend.

The $98.6 million cut in income taxes is projected to save $58 for a typical family of four making $40,000, Walker’s news release says.

Due to the $322.6 million adjustment in state income tax withholding, working parents in a family with four members will see an extra $57.90 in their monthly paychecks, Walker said.

Property owners’ bills are also going down because of a law the governor signed this spring that gave $400 million in relief to technical schools to help reduce their levies, according to State Rep. Garey Bies, R-Sister Bay.

“Funding for technical colleges is too heavily dependent on property taxes,” Bies said in a news release. “Since I’ve been in the legislature I’ve put forward legislation to change this, but never with any success. I’m hopeful the legislature will build on these efforts and identify additional funding sources for these schools. We can’t continue to have the tech schools funded on the backs of homeowners.”

While Wisconsin’s state and local tax burden dropped from 11.3 percent of personal income to 11.1 percent, the total tax burden jumped from 30.4 percent to 31.3 percent due to increases in federal tax collections, according to a report published by the Wisconsin Taxpayers Alliance.

Williams said it’s important for legislatures to continue to look for ways to cut taxes because those reductions also help states become more viable in the marketplace and improve overall standards of living.

“When states get it right with pro-growth tax policy and become more competitive, it’s a huge reward, this huge amount of capital out there that states can attract and grow their states’ economy,” Williams told Wisconsin Reporter.

In the Midwest, Wisconsin ranked fourth out of 10 in both raw jobs growth and job percentage change from August 2013 to August 2014, according to PolitiFact Wisconsin.

Other states appearing on ALEC’s list of making significant tax cuts in 2014 were Michigan. Minnesota, Arizona, Florida, Indiana, Kansas, Maryland, Missouri, Nebraska, New York, Ohio, Oklahoma and Rhode Island.