Madison in the Morning

Madison in the Morning

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Joint Finance Committee passes contentious tax cut proposal

MADISON (WKOW) -- A major phase in the budget process for 2023-2025 finished Thursday. The Joint Finance Committee voted to pass a budget including what Republicans are calling a "historic tax cut."

"I want to highlight, this is a middle-class tax cut," Rep. Terry Katsma said during a committee meeting Thursday evening. 

He and fellow Republicans say they're proud of the proposed tax reform that will tap into the state's projected $7 billion surplus. 

"The income category of $18,000 to $405, the largest bracket that includes the most taxpayers, that's the rate that's going down to 4.4%," Katsma said. 

The state currently has four tax brackets which Republicans hope to condense to three under the new budget. 

The top bracket, paid by households earning more than $405,550 a year will see a decrease from 7.65% to 6.5%. The two, no combine, middle brackets paid by households earning between $18,000 and $400,000 a year at 4.65% and 5.3% respectively will drop to 4.4%.

The lowest bracket will drop from 3.54% to 3.5%. A plan Democrats say is the opposite of a middle-class tax cut. 

"Millionaires are 0.3% of the overall tax filers receiving a huge amount of a break here on an average of $30,286," Rep. Even Goyke said. "Meanwhile, people making between 40 and $50,000 a year are going to receive $88."

Goyke told Republican law makers during the committee meeting they could not pass a tax cut that provides more money to millionaires than the middle class and call it a "middle class tax cut."

"I don't define the middle class is somewhere between $18,000 a year and $400,000 a year," Goyke said. "I mean, there is a big difference between people in those two income stratas and there is a big difference in this motion." 

Representative Tip McGuire introduced an amendment to the plan, proposing the top bracket continue to be taxed at the same rate. The amendment was quickly voted down. 

Republicans say the finalized budged will hopefully make its way to the state Senate and Assembly by next week.

More at WKOW 27 News


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