Wisconsin- Can’t Use Booming Online Sales Tax Revenue to Help State Budget


While Wisconsin looks to dig its way out of the financial crater of the COVID-19 pandemic, it won’t be able to tap into sales tax revenue collected from online retail, one of the only thriving sectors of the economy.

That’s because while other states can use taxes from booming online sales to offset the drastic decline in income, sales and excise taxes, Wisconsin law requires those funds to be used for income tax breaks.

States have been able to collect taxes from out-of-state businesses, including online retailers like Amazon, since the U.S. Supreme Court cleared the way in 2018.

According to the Policy Forum report, even before the pandemic pushed online sales through the roof, the state was already anticipating an income tax cut of $119 million for 2020, up from $77 million in 2019, the first year Wisconsin collected taxes from out-of-state sales.

While the income tax cut resulting from online sales and marketplace taxes will likely be substantial, it won’t get money into the hands of taxpayers, and into the economy, in the short term.


For more information: The Cap Times

the cap times
by steven elbow
june 18, 2020