MADISON—The state’s pending 2007-09 budget contains more tax and fee changes—increases and decreases—than any budget since 1999-2001 when the state had its last major income tax cut, the Wisconsin Taxpayers Alliance (WISTAX) reports in the latest issue of its Focus newsletter.

Now celebrating its 75th year, WISTAX is a nonprofit, nonpartisan organization dedicated to policy research and citizen education.

For the two-year budget period, WISTAX estimates, from Legislative Fiscal Bureau documents, that various tax and fee increases exceeded $1.7 billion, while various decreases amounted to about $60 million.

The Alliance pointed out, however, that many of the reductions are phased in over multiple years and don’t take full effect until 2011. For example, the largest cut, an expanded income tax deduction for health insurance premiums, would save $11.8 million next year, but $149 million by 2011.

The single largest revenue increase ($546 million for 2007-09) comes from tobacco taxes—a $1.25 per pack increase in the cigarette tax and a 40 percentage-point increase in the companion tax on other tobacco products. The other leading increase is a new 1% tax on hospital gross revenues ($418 million).

New revenues for transportation are significant in the new budget, WISTAX observed. Various transportation fee increases, e.g., for vehicle registration, will net an additional $189 million, and a new oil tax will generate an estimated $272 million over the biennium. One of the main reasons for the new transportation revenues is that the two prior state budgets used $1.1 billion in gas taxes and fees to balance general fund budgets.

For a copy of WISTAX’s latest report, "Proposed Tax Changes: State Budget," contact: wistax@wistax.org; 608-241-9789; or WISTAX, 401 North Lawn Avenue, Madison, WI 53704. o