Report: No Tax on Tips, OT Could Cost Wisconsin $2.7B in Taxes over Decade
A new report says the change would save eligible workers more than $2.7 billion over 10 years and cut state revenue by the same amount.
- A new Forward Analytics report indicates that eliminating state income taxes on tips and overtime would reduce Wisconsin revenue by $2.7 billion over the next 10 years.
- Governor Tony Evers previously vetoed legislation matching federal policy on these tax exemptions, arguing the measures failed to provide permanent relief and tied the state budget to federal whims.
- Fiscal estimates from the Wisconsin Legislative Fiscal Bureau show the proposal would reduce individual income tax collections by $232.8 million in 2026-27, followed by $197 million in 2027-28.
- Republican gubernatorial candidate Tom Tiffany has pledged to cut state income taxes by 10% for families earning under $150,000, alongside eliminating taxes on tips and overtime.
- Analysts warn that if support for these policies remains strong, future debates must rely on analytical foundations to clearly explain long-term consequences for Wisconsin's tax structure and economy.
12 Articles
12 Articles
Trump’s budget rips nearly $3 billion from swing state’s coffers
President Donald Trump’s “no tax on tips” part of his Big Beautiful Bill was one of the few bright spots garnering popular support of the legislation last year. However, analysts say one of the few progressive bright spots of the controversial bill has a dark side that will whack big dollars from some state budgets. One in particular: a state that went Trump in 2024, according to the Milwaukee Journal Sentinel.Eliminating Wisconsin's taxes on ti…
Northwestern Media
Journal SentinelCost of ending Wisconsin tax on tips, OT pegged at $2.7B over decade
No-Tax-On-Tips Proposal Could Cut Wisconsin Workers’ Taxes By $2.7B Over 10 Years
MADISON, WI — A new report released by Forward Analytics finds that a “No-Tax-On-Tips” proposal, paired with the pre-existing federal policy, would reduce state income taxes for Wisconsin workers who earn tips and overtime by a combined $2.7B over the next decade, with an equal cost to total state revenue collections. The report additionally examines how the proposal would interact with other tax credits (including SNAP), and how it could lead t…
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