Wisconsin entrepreneurs and that state’s economy benefit from a capital gains tax rate that is lower than the personal income tax rate. Wisconsin’s top personal income tax rate is 6.75%, while the top capital gains tax rate is 2.7%.
But now Governor Jim Doyle has a proposal to push the capital gains tax rate to 0% under certain circumstances.
In a January 7 report, the Milwaukee Journal Sentinel explained:
Some Wisconsin investors should be allowed to avoid paying taxes on capital gains if they reinvest the money in emerging state companies, Gov. Jim Doyle said Monday…
Doyle proposes to allow individuals, partnerships and limited liability companies to avoid paying tax on as much as $10 million of their capital gains if they use them to fund qualifying young businesses in the state…
"This capital gains proposal is extraordinary, and I think he's courageous to propose it. Generally the Democrats have not been proponents of capital gains tax relief for economic development and job creation," said Mark Bugher, director of Madison's University Research Park. Bugher was secretary of the state departments of revenue and administration when Republican Tommy Thompson was governor.
This is a positive, pro-growth proposal. It would be even better without any restrictions whatsoever. Kill capital gains taxes altogether – on both individuals and corporations – and the state will become a magnet for investment and entrepreneurship.
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