(UPDATE – July 8, 2021) — Gov. Tony Evers on Thursday vetoed measures to eliminate the state’s personal property tax, saying the proposed bill could potentially apply to the state’s ad valorem utility taxes and create unintended consequences for railroad and utility taxes as well as the manufacturing and agriculture credit, the Wisconsin State Journal reports.
Evers has asked the Legislature to pass a new bill that addresses any unintended impacts to allow for an elimination of the personal property tax.
Wisconsin lawmakers vote to eliminate personal property tax
(July 1, 2021) — Legislation eliminating the state’s personal property tax has passed the Wisconsin Legislature.
Assembly Bill 191, which was approved Tuesday evening by the Assembly and Wednesday afternoon by the Senate, now heads to Gov. Tony Evers for his signature.
The tax — first implemented in 1849 as part of the state’s property tax — originally exempted $75 worth of household items and included property such as bonds, jewelry, furniture, cattle and crops. For the last 175 years, exemptions have whittled away at the tax, leaving a levy applied only to businesses on furniture and other miscellaneous office fixtures. It is in addition to the real estate property tax.
The Wisconsin Newspaper Association is among the members of the Coalition to Repeal Wisconsin’s Personal Property Tax, which collectively represents nearly every industry in the state. The WNA and the coalition are urging Gov. Tony Evers to sign the legislation and save the state’s businesses roughly $200 million.
Over the years, the law has not been administered uniformly, with the latest exemption of machinery in 2017 providing a prime example.
Lack of guidance from the Department of Revenue put the onus on municipalities to determine what property was considered exempt under following the change — making an already unfair tax even more inequitable.
According to a Legislative Fiscal Bureau informational paper issued in January 2021, 2% of the state’s tax levy in 2019-20 came from personal property taxes.
The 2021-23 biennial budget includes $202 million for local governments to offset the lost revenue.
Prior to COVID-19, brick and mortar businesses struggled to compete with online retailers not subject to the fee, and the pandemic has further put businesses at a competitive disadvantage.
COVID-19 placed an additional, unmeasurable impact on Wisconsin businesses, including newspapers and other businesses across the state. Elimination of the personal property tax sends a strong signal of support from the state to the business community, the coalition said in a statement.
The repeal not only benefits businesses but also helps Wisconsin’s economy by allowing for business growth, which translates to additional property, income, sales and excise tax revenue.
Newspapers encouraged to support repeal
WNA members are strongly encouraged to consider publishing an editorial supporting the repeal of this outdated tax and/or reaching out to Gov. Evers to request he sign the legislation.
The coalition would like to thank Rep. Dan Knodl (R-Germantown) and Sen. Duey Stroebel (R-Saukville) for shepherding the bill through to passage and all of the legislators who supported of the bill. Thanks to the votes of the following Assembly Democrats, the legislation had bipartisan support: Reps. Deb Andraca (D-Whitefish Bay), Sara Rodriguez (R-Oak Creek), Don Vruwink (D- Milton) and Steve Doyle (D-Onalaska).
