Wisconsin Taxpayer Magazine Postrecession Snapshot: Total Taxes in 2011
December 2011 • Vol. 2011 No. 12
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- Summary
- Press Release
Wisconsin state-local taxes claimed 11.9% of state personal income in fiscal year 2011, up from 11.7% the prior year and 11.3% in recession-plagued 2009. This year's increase was largely due to recent tax increases and to the economic recovery adding to income tax collections.
Kyle C. Christianson or Todd A. Berry
608-241-9789
wistax@wistax.orgState-Local Taxes Up 5.4%, Claim Largest Share of Income Since 2006
Earlier Tax Increases, Economic Recovery Lead to Higher Tax Burden
download press releasee-mail this link to a friendMADISON—State-local governments collected $25.9 billion in taxes and fees in fiscal year 2011, 5.4% more than in 2010. This year’s tax burden was the highest since 2006, reflecting 2009-10 tax increases and a modest economic recovery. These findings are from a new Wisconsin Taxpayers Alliance (WISTAX) report, “Postrecession Snapshot: Total Taxes in 2011.” WISTAX is a nonprofit, nonpartisan organization dedicated to public policy research and citizen education.
State-local taxes claimed 11.9% of total state personal income in 2011, up from 11.7% the prior year and 11.3% in recession-plagued 2009. Because tax collections following a recession tend to rebound faster than personal income, tax burdens often rise early in a recovery.
Higher tax collections in 2011 were largely driven by increases in individual income and property taxes—the two largest state-local taxes. Individual income tax revenues rose 10%, from $6.1 billion in 2010 to $6.7 billion in 2011, partly due to the recovery but also to tax increases. Those increases included a new tax bracket for the state’s highest earners and a reduction in the capital gains exclusion included in the 2009-11 state budget.
Although the 2010-11 (taxes levied in December 2010, paid in 2011) property tax increase was the smallest since 2005, the statewide levy grew 2.6% to $9.3 billion. Last year’s increase was driven by school levies (+3.4%), which rose more than municipal (2.1%), county (1.9%), and technical college (2.0%) taxes.
Although rarely discussed, unemployment insurance (UI) tax collections also jumped considerably in 2011, from $760.2 million to more than $1 billion. Higher tax rates and an increase in the taxable wage base from $12,000 to $13,000 pushed UI revenues higher. Employers are currently charged a special assessment to repay federal loans used to fund UI payments during the downturn.
A free copy of The Wisconsin Taxpayer, “Postrecession Snapshot: Total Taxes in 2011,” is available by visiting www.wistax.org; e-mailing wistax@wistax.org; calling 608.241.9789; or writing WISTAX at 401 North Lawn Ave., Madison, WI 53704-5033.