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MADISON, Wis. - The top 1 percent of Wisconsinites would do best under a tax plan being advanced by President Trump and Republican leaders such as Wisconsin's Paul Ryan, according to an analysis just released by the nonpartisan Wisconsin Budget Project.
The plan is being touted as a "middle-class miracle," but the analysis says that's not true, either.
Budget Project director Jon Peacock called the plan "a windfall for millionaires."
A recent analysis by the Institute on Taxation and Economic Policy shows that millionaires, the top 1 percent of Wisconsinites, would get a little over three-fifths of the tax benefit from this plan," Peacock said. Peacock said the top 1 percent in Wisconsin would get an average tax cut of $76,000, compared with a tax cut of $260 for the bottom three-fifths of income earners in the state.
Challenging the way Republicans are presenting the plan as a boon for middle-income Americans, Peacock said, "this tax plan would funnel more money into the pockets of those who need it the least." Republican leadership has defended the plan, saying it will pave the way for massive tax cuts that will benefit the middle class. According to Peacock, however, the plan would widen the gap between haves and have-nots. "Well, we've seen that divide grow quite substantially over the last two, three decades, and this would just accelerate that trend," he said. "We ought to be adopting policies that go in the opposite direction."
The Wisconsin Budget Project's analysis showed both short-term and long-term bad effects for middle-income Wisconsinites. "This plan would actually boost the federal deficit by $1.5 trillion," Peacock said, "and at some point that's going to have to be paid for, and once it's paid for, the vast majority of Wisconsinites are going to be worse off because of this plan."
Peacock said the plan will be paid for with either substantial spending cuts or by raising tax rates again. The ITP report is online at itep.org and the WBP analysis is at wisconsinbudgetproject.org.
