Report: Wisconsin tax burden hits new record low in 2024 

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 percent in 2023 to 9.62 percent 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.” 

Last year, local and state tax collections also grew at their slowest rate in the past seven years, according to the research.

Tyler Byrnes, the report’s lead author, said the tax burden in Wisconsin was at 14.74 percent in 1972. But it has been declining for years.

“Each year, incomes do tend to grow,” Byrnes said. “And so as incomes have been growing, and there’s been pressure to keep tax revenues from growing, this burden has trended downward over time.”

Kevin Rich, the chair of the accounting department at Marquette University, called the numbers “good news.” 

“A lower tax burden means that citizens have more money to fill their priorities, and arguably, they’re able to put that money into the economy and elicit economic growth,” Rich said.

Jerry Deschane, the executive director of the League of Wisconsin Municipalities, said the state has been going in the right direction.

“This is one of those things you don’t want to be at the top of the list, but you sure don’t want to be at the bottom either,” Deschane said.

“I think we have done a good job of balancing the demand for excellent services with keeping the price tag affordable,” he added. “I think there is always a danger that that can get out of balance.”

Another recent Wisconsin Policy Forum report found Wisconsin ranked 35th in the nation for its size of tax burden. That’s down from 25 years ago when Wisconsin ranked third. 

What the report says

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 modest rise was largely due to the fact that inflation is now receding after several straight years in which it drove up sales tax revenues rapidly,” the report said.

Byrnes said efforts from state lawmakers have also helped keep the tax burden down. Democratic Gov. Tony Evers and Wisconsin Republicans have argued over tax cuts in recent years.

“We’ve had pretty tight limits to how much property taxes could go up over the past 15 years, and then there has been efforts by state leaders to lower our income taxes,” Byrnes said.

The report didn’t take into account new 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.

Byrnes said it’s tough to say if the tax burden will go up in Wisconsin next year.

“I would also say that the number of referendum, school referendum, municipal referendum, that go onto the property tax levy might also have an impact there,” he said.