JFC makes sweeping changes to state's tax code

MADISON (WITI) -- It took all night and into the early morning hours, but the Legislature's budget writing committee is finished. Included in the final moves is a sweeping overhaul of the Wisconsin Tax Code.

After a marathon session that split two days, the political parties remain divided over the results.

"It's a win-win for taxpayers around the state," Rep. Robin Vos (R - Burlington) said.

"Well, it's a win-win for those people who make over $300,000 a year, but it's a huge loss for the middle class," Rep. Peter Barca (D - Kenosha) said.

The $650 million income tax cut is the largest in a decade.

"If you're a taxpayer in Wisconsin, if you have a small business or if you're an individual, you're going to pay less taxes next year than you do this year. That's a big win for everybody in our state," Vos said.

Democrats say the cut comes on the backs of public school students, who saw historic cuts in the last budget.

"They took roughly $800 million dollars away from public school classrooms, and they said they had to do that because we had a deficit. Now we have a surplus. Instead of giving this back, the bulk of this is going to people who make above $300,000 a year," Barca said.

"There are people in Madison, especially my friends on the other side of the aisle who want government to spend the money because they want people who they think are in some state agency can make decisions better than the average family as to what's best for them and their future.  I just fundamentally disagree with that," Vos said.

The Joint Finance Committee also simplified the tax code -- reducing the five tax brackets to four. Tax rates are reduced for every taxpayer, but the plan also creates a large bracket that encompasses the majority of workers in the state. Those earning $28,651 to $215,460 will be paying the same rate: 6.27 percent.

"All the attention on the federal level was on Warren Buffet saying 'look don't make my secretary pay the same rate that I pay.' That's exactly what Kooyenga now has brought to Wisconsin -- is to say somebody who makes 28,000 a year is going to pay the same rates as someone who makes well over 200,000. Where's the basic fairness here?" Barca said.

The final budget will next be voted on by the full Legislature.