Home | State Tax Profiles | Tax Calendar | Locations | POER Connect Login | Client Connect Login

Wisconsin Considers Personal Property Tax Reform

by Rita Bartgis, Dallas, November 2014


Wisconsin is the latest state to consider changing its business personal property tax system. Some lawmakers believe the total elimination of the tax is needed in order to create a more business-friendly environment. However, a group of mayors is opposed. They fear that eliminating the tax will harm cities that are facing huge budget deficits and are already limited by tax caps.


Neighboring States Enact Reform


The debate over personal property tax reform in Wisconsin comes on the heels of changes in other states.


A new law in Indiana gives counties the option to exempt new property from the tax, exempt businesses with less than $20,000 in personal property, or give businesses a long-term tax abatement.


Michigan changed its personal property tax with a ballot initiative approved in August. Michigan now exempts all new property bought by businesses and also gives small businesses with total personal property amounting to less than 80,000 an exemption.


Legislative Council Studies PP Tax


The Legislative Council's Steering Committee on Personal Property Tax heard from dozens of witnesses in three official meetings over the summer. They heard complaints that the 57 exemptions to the tax make the system complex and unfair.


"It has gotten to the point where the personal property tax is now a tax on a handful of business property that affects those unfortunate Wisconsinites who have not been given an exemption," Committee Chairman Duey Stroebel explained.


The final committee report identified a list of options to repeal or reform Wisconsin's personal property tax, ranging from complete elimination to changes in the way the tax is administered.


Mayors Say Tax is Necessary


A group of mayors, all members of the League of Wisconsin Municipalities Urban Alliance, are speaking out against a repeal of personal property taxes.


Mayor John Dickert said now is not the time to talk about eliminating the tax. "We are still trying to get our heads above water," he said. "It's not a good idea right now."


Mayor Tim Hanna of Appleton agreed, saying while he isn't a big fan of personal property tax, it shouldn't be eliminated without finding a way to replace the revenue that would be lost.


Both sides on the issue will be heard when the 2015-2016 legislative session begins in January in Madison.