State Senator Mary Lazich (R-New Berlin) represents parts of four counties: Milwaukee, Waukesha, Racine, and Walworth. Her Senate District 28 includes New Berlin, Franklin, Greendale, Hales Corners, Muskego, Waterford, Big Bend, the town of Vernon and parts of Greenfield, East Troy, and Mukwonago. Senator Lazich has been in the Legislature for more than a decade. She considers herself a tireless crusader for lower taxes, reduced spending and smaller government.
There are a number of studies concluding that in other countries, high corporate tax rates tend to depress wages. A new study by the nonpartisan Tax Foundation in
States with high corporate income taxes see the wages of their workers depressed over time. States with lower corporate taxes enjoy an increase in worker productivity and wages.
The Tax Foundation writes the following in its report, “The Corporate Income Tax and Workers’ Wages: New Evidence from the 50 States” that reviewed state data from 1970 through 2007:
“A one percent drop in the average tax rate leads to a 0.014 percent rise in real wages five years later. In dollar terms, that means wages rise $2.50 for every one dollar reduction in state-local corporate income taxes. The reverse is also true: A one percent hike in the average tax rate leads to a 0.014 percent drop in real wages, or roughly a $2.50 loss in wages for each one-dollar rise
in corporate tax collections.”
The report estimates that an average state corporate tax rate increase of one percent aggregated over the approximate 145 million American workers would result in a drop of $715 million in wages. The burden of increased corporate taxes, despite conventional wisdom, falls squarely on the workforce. Raising corporate taxes in the guise of tax fairness and progressivity would be unwise public policy.
Read the Tax Foundation report here.