Walker's Tax 'Reforms' Hurt Working Poor, Reward Businesses, Higher-Earners
Section G, page 23 of Scott Walker's proposed budget - - "Revenue and General Fund Taxes" - - offers perhaps the starkest contrast on one page in the entire document.
In this section, capital gains on investments held for five years in Wisconsin are to be 100% tax-exempt; capital gains will allowed to be deferred for Wisconsin-based businesses.
And allowing business to expand the ability to carry forward losses will save estimated $47 million over the biennium.
So how do you make up for that $47 million loss, not to mention the capital gains taxes not collected, especially with all the hand-wringing over budget deficits, red-ink, etc.
Drop down a few paragraphs and get to the section about Wisconsin's working poor.
Walker wants to "reduce the percentages of the federal earned income tax credit" that the working poor can claim on their State of Wisconsin returns.
The Earned Income Tax Credit is a credit for working people, not freeloaders - - so Walker's budget means they get less of the credit allowed by the feds and thus pay more into the State Treasury.
How much is to be squeezed from the working poor?
$41.3 million.
Hey - - Not much off what businesses will save through some of the breaks listed in the same budget section.
So Walker wants to raise poor people's taxes, drive up their bus fares...this budget is a declaration of war against Wisconsin's most vulnerable residents, and certainly against the City of Milwaukee, a low-income and transit-dependent community.
Civil rights lawyers must be seeing this.
2 comments:
Thanks for shining the light on such a cruel provision in the budget. You're right that this results in the working poor paying more in state taxes, but perhaps it's under-covered in the broader media because it involves an arcane mechanism -- how the state handles a federal tax "credit." If you could help explain exactly how the federal credit works and how it impacts what's paid in state income taxes, that'd help expose what's going on here. It's bad.
Earned income tax credit is a great advantage to many, however, I personally know many, including myself when I was younger, that receive much more in refund than is paid "in" in wage collected taxes. Perhaps this curtail will move the refund amount closer to the amount actually paid in. I dont think you should receive a refund for an amount larger than you contributed.
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