The Great Wisconsin Escape Doesn't Add Up

Where I'm from in Illinois we tell Kentucky jokes. My favorite being why did they build the bridge at Shawneetown?  So Kentuckians can swim over in the shade, the punchline goes. When we see slow moving cars on the roads we immediately assume they somehow escaped from Kentucky and are now lost in Southern Illinois. That's just how things are in deep south Illinois.  I assume in the northern part of the state the casual joke telling falls on Wisconsin, at least it appears that way judging by the latest media war between the Dairy State and the Land of Lincoln.

The latest swarm of competition stems from the Illinois General Assembly voting to increase tax rates.  The Assembly approved and Governor Quinn signed legislation that raises the personal income tax from 3% to 5%.  That's a two-cent on the dollar raise. The legislation also raised the corporate income tax rate from 4.8% to 7%.

The media is portraying the increases as a 66% increase in personal income taxes and a 46% increase in corporate taxes.  Be that as it may, the new Republican governor of Wisconsin, Scott Walker, saw this as a way to attract Illinois citizens and Illinois business to his neighboring state.  Gov. Walker released a massive media blitz onto the Chicago media market yesterday inviting people and businesses to "Escape to Wisconsin," where he claims taxes are lower.

One tiny mistake with all that.  Wisconsin has higher taxes, even after Illinois' massive increases voted in this week.

Refugees fleeing to the cheese factories of Wisconsin will be rudely slapped with a personal income tax of 6.15%, a full 1.15 points higher (or 23% higher to use media math) than Illinois'.  Those making over $20k, which I hope is a vast majority of them, will see a personal tax rate between 6.5- 7.75%!  If we use the media's formula again to calculate the increase that's-- in the very least-- a personal tax rate 30% higher than Illinois.

Even the corporate tax will still be lower in Illinois, 7% versus 7.9% in Wisconsin.

In no uncertain terms would anyone move to Wisconsin for lower taxes.  It's not possible.  Only in a make-believe fantasy world is 6.5 a lower tax rate than 5.

What the Republican governor of Wisconsin is wanting to do is use the media's 66% increase label to scare people into thinking their taxes are going to be 66 times higher than what they are now.  If we apply that same misleading math to the Wisconsin escape, Illinois citizens that move up there will see a personal income tax increase of over 100%.  Why can't the media report that?  And why can't normal, everyday people ask a couple simple questions instead of depending on flashy and inaccurate headlines?