Walker says $340M income tax cut reasonable
MADISON, Wis. (AP) — A roughly $340 million income tax cut over the next two years would be a reasonable starting point, Gov. Scott Walker and Republican state Assembly Speaker Robin Vos said on Tuesday.
Walker said he envisioned cutting taxes about $200 per Wisconsin family over the next two years, although details about how much any taxpayer would be affected were still being worked out.
Walker has promised to make a middle class income tax cut a centerpiece of his two-year budget being released next month, even as Democrats and even some Republicans are calling on him to prioritize other needs like education funding that got severely cut in his last budget.
Walker said Tuesday, following a speech at the Wisconsin Technology Council, that he was eying the state’s current projected budget surplus of $342 million for the income tax cut.
“We think it’s reasonable to focus in on the surplus. The surplus is $342 million,” he said. “The taxpayers are obviously at the forefront of making that possible.”
Earlier on Tuesday Vos said the income tax cut would be at least $300 million to $350 million.
“I hope that’s a low end of the number,” Vos said.
Walker previously said he wanted to phase in the tax cut over a period of years. He didn’t mention that on Tuesday, but said many details about how the tax rates would be modified to maximize the benefits to the middle class remained a work in progress.
The priority, he said: “Could you put a couple hundred dollars into the hands of citizens across the state?” He previously said he wanted to target the tax cut to those making between $20,000 and $200,000 a year.
Democratic Assembly Minority Leader Peter Barca didn’t comment directly on the size of the tax cut. Instead, he emphasized that any tax cut should benefit the middle class.
Rep. Sandy Pasch, D-Whitefish Bay, said that income tax cuts must be part of a broad package aimed at helping the middle class that also includes putting more money into public education, job training and high-quality health care.
Democratic Senate Minority Leader Chris Larson of Milwaukee echoed those comments, saying he wasn’t confident Walker would structure the tax cut in such a way to really benefit the middle class.
Release of Walker’s budget is about a month away and he’s still not saying much about what will be in the plan, beyond broad priorities like reforming education.
In his speech to the technology council, Walker said he envisions making extra money available for both low and high performing schools based on how they do on new state report cards.
High performing schools, or those showing rapid improvement, should be eligible for more money. Failing schools could get a one-time boost in funding if they present a corrective action plan, he said.
“We want to reward and replicate success,” he said.
Walker also wants to expand charter and voucher school options, a move Democrats oppose because it takes money from public schools. He hasn’t revealed details about how he would achieve that or what level of aid to schools he will propose.
Walker also said Tuesday that he was exploring options to increase money available for venture capital, which he and other supporters say is needed to help startup companies grow and create jobs in Wisconsin. Walker said the challenge was finding the right mechanism and dollar amount that can pass in the Legislature.
“Where’s the sweet spot?” Walker asked.
Walker in 2011 proposed creating a venture capital fund, which makes money available to startup and growing companies, but it failed over disagreements about how such a fund would be structured, who would benefit and how much it would cost.
Walker said at least $30 million would have to be available to make the fund viable. He encouraged those on the technology council, which includes a spectrum of business, government and education leaders as well as financiers and those heading startup companies, to reach out to lawmakers.
“The most important thing you can do is make the case to lawmakers that this is not just about benefiting Milwaukee and Madison,” Walker said.