On April 1, 2008, I blogged about a Competitive Wisconsin Inc. (CWI) report that used 33 measures in six categories to show Wisconsin’s ability to compete nationally continues to sag. 

The nonpartisan Wisconsin Taxpayers Alliance (WISTAX) took the tables and charts from the CWI report and assigned grades to Wisconsin in all 33 benchmarks.

WISTAX reports, “Of the 33 measures, Wisconsin had four grades in the A range, 12 each in the B and C ranges, and five in the D range. The average grade over all measures was just below 2.5, or B-/C+. The two areas with the strongest grades were quality of life (averaging about a B) and workforce excellence (B- average). Low grades were given to new business creations (D+) and venture capital per worker (D), both of which suggest that future job creation could be at risk. Also disconcerting was the steady rise in energy costs (C-), once an area of decided advantage.”

Here is the entire WISTAX report.

No matter what economic study or report you look at, the conclusion is always dismal for Wisconsin when it comes to taxes.

The latest comes from the Small Business & Entrepreneurship Council.

Small Business & Entrepreneurship Council chief economist Raymond Keating has just completed the “Business Tax Index 2008” for all 50 states and the District of Columbia.

Using 16 different tax measures to compile one score, Keating ranks the states according to their Business Tax Index. Among the factors Keating studied were a state's top personal income tax rate, a state's top individual capital gains tax rate, a state's top corporate income tax rate,  property taxes, and gas taxes.

Wisconsin ranks number 32, near the bottom third of all the states.

Keating writes, “As Elvis Presley said: ‘A little less conversation, a little more action please.’ For example, more action is needed by elected officials in many states to make their state tax systems friendlier towards entrepreneurs and small businesses.”

I concur, having blogged extensively about Wisconsin’s unfreindly business climate that is severely hampering business growth and retention. Our high taxes coupled with one of the lowest per capita income rates in the country are forcing too many residents to leave the state.

Our state faces a revenue shortfall of $652.3 million, and yet some legislators in Madison want to increase taxing and spending even further.

Keating’s new study is yet another wake-up call to the Legislature and the governor to control excessive taxing and spending.

Read Keating’s entire piece.

Also, the nonpartisan Tax Foundation in Washington D.C. has more details on Wisconsin’s tax system and comparison to other states.

 

     

Almost a year ago, on April 2, 2007, I blogged that the U.S. Bureau of Economic Analysis reported during 2006, the rate of growth in Wisconsin income ranked near the bottom compared to all other states. Wisconsin’s per-capita personal income grew 4.3 percent. The national average of per-capita personal income growth was higher at 5.2 percent. Our income growth ranking put us in the bottom 10 states.

I also blogged about a Wisconsin Taxpayers Alliance study that found from 1999 to 2005, Wisconsin’s median household income fell 2.2 percent from $45,667 to $44,650, while the national median rose 13.8 percent from $40,696 to $46,326. Wisconsin ranked 50th in the nation in household income growth during the period. Meanwhile, spending by state and local governments in Wisconsin takes over 20 per cent of your personal income.

You can read my entire blog from a year ago here. 

It’s disturbing that the downward spiral of Wisconsin income continues.

Competitive Wisconsin, Inc. (CWI), a nonpartisan group of state agriculture, business, education and labor leaders has released its tenth annual Benchmarks Survey, rating Wisconsin in 33 areas of interstate competitiveness.  Seventeen benchmarks changed this year, with eight improvements, and nine declines on some key areas, signaling reason to be concerned about Wisconsin’s ability to compete nationally.

Three benchmarks stand out:


1)    PER CAPITA INCOME: Wisconsin’s per capita income, $34,476, is below the national average of $36,629. As CWI reports, “Personal per capita income is often cited as a measure of a state’s relative economic health. Wisconsin’s per capita income also continues to significantly trail that of its neighbors, Illinois ($38,297) and Minnesota ($38,751).”

2)    JOB GROWTH: CWI reports, “In 2006, the number of Wisconsin jobs increased 0.7%, a drop from 1.1% in 2004 and 1.2% in 2005. Wisconsin trails the national average of 1.8%.”

3)    CREATION OF NEW PRIVATE BUSINESSES: Wisconsin lags behind the nation in this category as well. CWI reports, “The number of new private businesses in Wisconsin dropped 0.4% in 2006, while the number of businesses grew nationally 2.5%. Even more troubling is that all of Wisconsin’s neighbors had increases in 2006.”


The CWI study is the latest in a series of gloomy eye-opening reports clearly demonstrating Wisconsin’s fragile economy is headed in the wrong direction.

Incomes are down. Job opportunities are down. The number of new businesses opening that offer job opportunities is down.

Because hard-working families have less income, their ability to keep financing government’s whimsical spending habits is more difficult. Since families have less, it is imperative government refrain from taxing them more.

Wisconsin is struggling to resolve a $652 million revenue shortfall.  The wrong solution is to raise taxes. Wisconsin taxpayers have given so much for so long that they cannot give anymore.

When families have trouble making ends meet, the last thing they do is pull out the Visa card. State government should adopt the same common-sense policy. How many more abysmal reports do we have to read before we realize the time to stop taxing and spending arrived a long time ago?

Here is the CWI report and a CWI press release.

The nonpartisan research group, the Tax Foundation in Washington D.C. has released a study showing most states in America, including Wisconsin, tax businesses at a higher rate than any other country in the developed world.

Here is how the Tax Foundation came up with its findings. For each state, the Tax Foundation added the state’s corporate tax rate to the federal corporate tax rate.  The results:

• 25 states, including Wisconsin have a combined corporate tax rate higher than top-ranked Japan.
• 35 states, including Wisconsin have a combined corporate tax rate higher than third-ranked Germany.
• 46 states, including Wisconsin have a combined corporate tax rate higher than fourth-ranked Canada.
• All 50 states have a combined corporate tax rate higher than fifth-ranked France.

I agree with Tax Foundation president Scott Hodge, who authored the study. Hodge says, “Tax competition for jobs and investment is fierce, and the U.S. continues to fall further and further behind. Our states should be the world's leaders in many things, but high taxation should not be one of them. The high federal corporate tax rate is literally crushing states' competitive abilities. That means fewer jobs for American workers."

Here is the Tax Foundation news release.

Here is the Tax Foundation full study.

Forbes.com has released its second annual Top States for Business report, and the news is horrible for Wisconsin. Wisconsin ranks #44 on the list of the best states for business. Wisconsin’s 2006 rank was #39.

Forbes.com rated the states on six different criteria: business costs, labor, regulatory environment, economic climate, growth prospects, and quality of life.

Here is how Wisconsin ranked in each of the six categories:

1) Business Costs- Wisconsin ranks #34. This index is based on cost of labor, energy and taxes.

2) Labor-Wisconsin ranks #38. This index measures educational attainment, net migration and projected population growth.

3) Regulatory Environment- Wisconsin ranks #44. This index measures regulatory and tort climate, incentives, transportation and bond ratings.

4) Economic Climate-Wisconsin ranks #38. This index reflects job, income and gross state product growth as well as unemployment and presence of big companies.

5) Growth Prospects-Wisconsin ranks #33. This index reflects projected job, income and gross state product growth as well as business openings/closings and venture capital investments.

6) Quality of Life-Wisconsin ranks #8. This is an index of schools, health, crime, cost of living and poverty rates.

The data is clear. Despite the fact Wisconsin is a great place to live, as evidenced by our high quality of life, the environment for business is toxic. Wisconsin taxes and spends too much, the state over-regulates, our income growth rate is one of the lowest in the country, and the brain drain is costing us many of our best and brightest workers.

The Forbes.com report is another wake-up call to Wisconsin to take dramatic measures to significantly improve our business climate, which continues to be abysmal.

How did surrounding states fare? Minnesota ranks #10, Iowa ranks #24, Indiana ranks #27, Ohio ranks #38, Illinois ranks #40, and Michigan ranks #46.

Here is the Forbes.com story and the table showing the ranking of all 50 states.

Small businesses are the engines that drive our economy. Their views are critical to the future success and welfare of our communities.

A new poll conducted by the Small Business Research Board finds the most important issue confronting small business is taxes, replacing the cost of health care as the #1 concern. Economic conditions in general and the cost of energy also finished ahead of health care in the poll of 770 small business owners across America.

“Taxes were the foremost concern of small business during the second quarter, however that does not mean paying the IRS is necessarily a seasonal issue. It does indicate that tax issues were more of a concern this year than other issues. Small businesses can adopt the same strategy as big businesses by strategically planning ahead and initiating actions to obtain the greatest tax efficiency,” said Gregg M. Steinberg, President of International Profit Associates that co-sponsored the poll.

Here are more details on the small business survey.