By Brian E. Clark
WisBusiness.com
Sen. Ted Kanavas, R-Brookfield, announced a package of economic incentives Tuesday morning, dubbed “Invest Wisconsin 2.0,” that includes a
proposal to cut state income taxes by 1 percent.
Kanavas, ranking minority member of the state Senate Committee on Job Creation, Economic Development, and Consumer Affairs, said the reduction would cost the state treasury $65 million in the first year. But he predicted that trimming income taxes would stimulate the Badger State economy and result in more money flowing to the state’s coffers.
“Can we afford it?” he said in response to a reporter’s question about the state’s looming $1.6 billion deficit over the next two years. “We can’t afford not to grow. We need to be serious about growth.”
Gov. Jim Doyle, speaking at Monona Terrace later in the day, said he was skeptical of Kanavas’ income tax cut plan. “It’s an easy thing for
someone to say who’s in the minority and doesn’t have to worry about balancing a budget.”
Aside from the tax cut, Kanavas’ plan includes liability reforms, millions to to boost the state’s nanotechnology field and millions more in tax incentives and tax credits.
Kanavas, chairman of the Senate’s economic development committee until that body changed hands in January, spoke before about 75 visitors from the Chippewa Valley. One of the measures he is backing specifically targets that part of the state.
Kanavas said he thought some of the measures would receive support from Democrats, who now hold the majority in the Senate, but he said he did not think liability reform proposal had much chance of becoming law.
The plan features:
– A “NanoSTEM Initiative” to provide $3 to $4 million to UW-Eau Claire, UW-Stout and the Chippewa Valley Technical College to pay for new
faculty and equipment to do nanotechnology research. (STEM stands for science, technology, engineering and math.) The program would also help attract news businesses, retool existing firms and train workers in the Chippewa
Valley.
– Nanotechnology tax credits worth $2.5 million over the next two years to stimulate more investment in the field. The credits could be used or carried over for expenses related to sales and use taxes for equipment used in nanotechnology research, development and manufacturing. They also could be claimed for payments made to a college or university for for
the cost of using its research facilities and developing products.
– Tax incentives worth $25 million over two years for venture and angel capital investment in Wisconsin companies. This legislation would add onto Act 255, which was passed in 2003 with bipartisan backing. The bill also would ensure that credits are not taxed by the Wisconsin Department of Revenue.
– Education tax credits worth about $20.6 million to help companies pay for continuing education for their employees, if the classes they take are provided by a Wisconsin education system okayed by the Education Approval Board.
– A capital gains reinvestment bill that would exempt individuals from capital gains taxes if they reinvest in a certified Wisconsin-based business. Kanavas said current law has a 60 percent income tax exclusion on the net capital gains realized from the sale of assets held for at least one year.
– Innovation tax credits of up to $10 million to encourage companies to create and maintain jobs through eligible projects that will update their current business practices. This could be done through research and development, product testing and by creating and protecting intellectual property or increasing efficiencies through updated computer software and hardware.
– Tax credits worth $2 million through a Green Data Center Incentive for companies that create new data centers that use low-emission building
materials, sustainable landscaping, catalytic converters on back-up generators, evaporative cooling and reduced amounts of lead, cadmium and
other substances.
– Product liability reform to allow recovery of damages for product defects while injecting a “dose of fairness” into the process by
offering “reasonable” standards and defenses for determining liability.
– Expert witness reform to limit testimony presented at cross-examination to only those who are qualified as experts. Kanavas said this bill would put Wisconsin in line with federal courts and most state courts in determining appropriate expert testimony in civil litigation.
– The Jobs Preservation Act would, Kanavas said, restore traditional rules relating to the establishment of liability cases for anufacturers and sellers of products in Wisconsin. This bill is in response to a state Supreme Court lead paint decision last year that ruled against manufacturers.
