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May 31, 2022 | By Katherine Loughead
Over the past decade, the state tax landscape has grown increasingly competitive as policymakers have sought to attract investment and promote economic opportunity and growth in their states. The past two years in particular have seen an extraordinary increase in tax reform efforts, given states’ strong revenue growth despite the pandemic and policymakers’ desire to make their states more attractive to an increasingly mobile workforce.
Most of the focus of these reform efforts has been on reducing state income tax rates, as corporate and individual income taxes are widely regarded by economists as more economically harmful than taxes on consumption and real property. Furthermore, states with low or no income taxes have seen significantly stronger gross state product growth and net inbound migration over the past decade than their higher income tax peers, and high-tax states are increasingly taking notice.
That’s why, in Wisconsin, comprehensive tax reform that prioritizes gross state product growth and personal income growth ought to be a top priority for policymakers, especially given the recent reforms made by many of Wisconsin’s regional and national peers.
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