Recycling Tax 

(Budget Bill – AB 133, 1999 WI Act 9)
The budget bill made permanent the 10-year old tax on businesses to help fund local recycling programs.  The tax was due to sunset this year under the original legislation passed a decade ago.  The tax rate will be 3%, applied to all businesses with $4 million in annual gross receipts with a maximum tax liability of $9,800.  The WRA opposed even higher taxes for recycling proposed by the legislature and joined many business groups in successfully encouraging Gov. Thompson to use his veto pen to produce the lower the final tax.

Time Share Taxation 

(Budget Bill - AB 133, WI Act 9)  
The state budget settled an on-going debate regarding the differing methods of taxing time share properties.  Under the old law, “fixed time” time shares were subject to the state transfer tax, while “flex time” time shares were subject to the sales tax.  According to the Dept. of Revenue, this situation created a substantial tax advantage for fixed time time share owners which resulted in units being sold as fixed time and later converted to flex time.  To remedy the problem, the DOR proposed to make all time shares subject to the sales tax, arguing time shares more closely resemble transient lodging such as hotels, than they do traditional property ownership. Resort and time share owners opposed this move and instead succeeded in changing the law so that now all time shares are subject to only the transfer tax.  They argued that because buyers receive a deeded interest in real property, condominium documents and a condominium budget which require maintenance fees, all of which resembles the purchase of a condominium.  The change was adopted as part of the final budget compromise. 

Honorable Mention (Did not pass) 

• SJR 24 - Elimination of the uniform taxation clause 
  SJR 24 proposed to amend the state constitution to allow the legislature to reduce property taxes imposed on residential and agricultural real property by authorizing credits against income taxes.  While the WRA generally supports lower property taxes, the WRA has always opposed this approach because additional state spending does nothing to address the problem of chronically high local property taxes.  Raising state taxes to help offset ever-increasing local taxes results in both state and local taxes increasing every year.  Income tax credits do nothing for helping qualify new homebuyers to purchase new homes.  Moreover, by focusing “relief” on residential and farm property only, this proposal would likely result in much higher property taxes on commercial, industrial, recreational and other classifications of property.   The legislation passed the state Senate 18-15, with all Democrats supporting the bill and all but one Republican opposing. The bill was not acted on by the state Assembly prior to adjournment of the session.