Assembly Republican road-funding plan cuts, raises taxes

Assembly Republicans' plan to pay for Wisconsin roads by applying the sales tax to gas has run into a roadblock in Gov. Scott Walker.

The proposal comes after members of the budget-writing Joint Finance Committee scrapped Governor Scott Walker's proposal to borrow and cut spending to help address a shortfall in the state transportation fund. The governor has said that while he's opposed to raising the gas tax, he's open to increasing revenue for transportation as long as the state's overall tax burden goes down.

Money from the transportation fund pays for state road and freeway projects and is given to municipalities to maintain their streets. They would apply Wisconsin's sales tax to gasoline purchases, which would increase taxes by 12 cents on the average gallon of gas.

But Assembly Democratic Minority Leader Peter Barca calls the plan "half baked" that gives tax breaks to the richest people in the state.

Kooyenga's plan has numerous other components, including eliminating a host of income tax credits — including the marriage credit — to move toward a 3.95 percent flat tax for all taxpayers by 2028; repealing the minimum wage on public projects; eliminating almost 200 Department of Transportation engineers; and creating a system for approving toll roads, which would need federal approval. "I plan to review the proposal in its entirety to determine how closely it reflects Senate transportation priorities as discussions on infrastructure funding continue". "There's a lot of moving parts that, even if we highlighted something we liked or didn't like, taking or adding or changing some of those things could really have a major impact on the entire package", Walker said.

"Is this ideal for anybody?" said Rep. Dale Kooyenga, the primary architect of the plan. "Instead what they'll to lower taxes for the very wealthy". At the same time, it cuts income taxes that pay for schools.

Other provisions in the plan include repealing the prevailing wage for state construction projects, giving local governments control over roundabout construction and seeking federal approval to begin tolling USA interstates in Wisconsin. Assembly Republicans would arrive at that number in a couple ways.

The plan also would create an annual fee of $30 for hybrid vehicles and $125 for electric vehicles, yielding about $4.8 million a year.

Reducing State Engineers: The plan would cut 180 engineering positions at the state DOT. The change would generate $4.8 million in revenue in the next two-year budget. The sales tax increase would need to be approved by voters in a referendum.

Tax credits targeted for elimination include the marriage credit, the itemized deduction credit, a credit for people renting homes or apartments, the alternative minimum tax, an internet access tax and the first dollar credit used to reduce property taxes.

  • Larry Hoffman