The amount Wisconsinites pay in state and local taxes relative to their incomes hit its lowest level since at least 1972 last year, according to a new report from Wisconsin Policy Forum.
The “tax burden” is the ratio of what residents pay in state and local taxes relative to their income. The report found that number fell from 9.92% in 2023 to 9.62% in 2024.
The report noted several reasons for the decline, but it said the decrease is partly due to, “continued growth in incomes in the state, plus aggressive efforts by the state to hold down local property taxes.”
The latest report found state and local tax revenues grew by 1.9 percent last year, from $36.2 billion in 2023 to $36.9 billion in 2024. But that didn’t keep up with the rate of inflation and was also the smallest increase since 2017, according to the report.
“Meanwhile, income growth easily outstripped the growth in tax collections, as personal income in calendar year 2023 grew by 5.2 percent — double the increase seen the previous year,” the report said.
The report found sales tax collections in the state, which increased by 1.8 percent in 2024, were the “slowest year-over-year growth rate since 2010.”
The report didn’t take into accountnew sales taxes in the city and county of Milwaukee because of how data was gathered for the report. Milwaukee was able to raise its sales tax in 2024 due to Act 12, a bipartisan law to overhaul local government funding. The Wisconsin Policy Forum said that data will be included in next year’s report.