• 
• CLASS
• JOBS
• AUTO
• HOMES

State’s combined-reporting requirement stirs debate

Wisconsin tax law changes continue to stir debate. Illustration by Terry Mayer/staff.

DELAVAN — It may be a term more familiar to corporate accountants than the average Wisconsin resident, but the state’s new combined-reporting tax requirement continues to generate debate among legislators, business leaders and economists.

Whether it’s a job killer or a fair tool for extracting additional tax revenue from large companies depends on who you talk to.

“Wisconsin loses an estimated $100 million a year in tax collections due to accounting techniques used by large multistate corporations,” said state Sen. Judy Robson, D-Beloit. “When corporations don’t pay their fair share, then you and I have to pay more. We are simply asking these companies to pay the same freight that other Wisconsin companies are paying.”

Others fear the law will prompt companies to flee the state, hurting a business climate that last year was ranked by Forbes as the third-worst in the nation, based on such factors as labor and energy costs.

“You can call it closing a loophole, but I think it’s very short-sighted to look at short-term revenue for the state, and not look at the fact that people are not working, not paying taxes because they’re losing jobs in this economy,” said Rep. Rich Zipperer, R-Pewaukee.

At the heart of combined reporting is the corporate income tax. If a company does business in only one state, its profits are taxable in that state. But if a corporation has subsidiaries in more than one state, profits are taxed in different ways.

Read the full story in the March 14, 2010 e-edition of Walworth County Sunday, HERE.