New sales taxes in Milwaukee and Milwaukee County go into effect Jan. 1. Here's what you need to know.
The City of Milwaukee and Milwaukee County will see prices creep up a bit in 2024 when the new sales taxes are officially implemented.
For those wondering what that may look like, here's what you need to know.
When do the new Milwaukee sales taxes go into effect?
Jan. 1, 2024.
What is the sales tax rate in Wisconsin?
Statewide, the sales tax is 5%.
What is the current sales tax in Milwaukee County?
For now, the sales tax in Milwaukee County remains the same at 5.5%, which includes the statewide sales tax (5%) and the county's current sales tax (0.5%).
What will the new sales tax be in Milwaukee and Milwaukee County?
The City of Milwaukee voted in June to implement a 2% sales tax.
Milwaukee County will increase its sales tax from 0.5% to 0.9%.
When both are implemented, the total sales tax paid in the City of Milwaukee will be 7.9%, while the total sales tax paid in Milwaukee County, but not the City of Milwaukee, will be 5.9%.
The following communities in Milwaukee County would pay the 5.9% sales tax on certain items:
- Bayside
- Brown Deer
- Cudahy
- Fox Point
- Franklin
- Glendale
- Greendale
- Greenfield
- Hales Corners
- Oak Creek
- River Hills
- Shorewood
- South Milwaukee
- St. Francis
- Wauwatosa
- West Allis
- West Milwaukee
- Whitefish Bay
Why did Milwaukee and Milwaukee County implement new sales taxes?
A looming fiscal cliff at the city and county level prompted Milwaukee-area leaders to push the state to increase the amount of shared revenue returned to communities. They argued the amounts had remained stagnant for many years and that the state should return more to Milwaukee, the state's largest economic engine. The ability to levy sales tax is part of a wider plan to boost funding for communities across the state. Without these changes, local officials warned that severe cuts would come to services, programs and staff.
Do other cities have their own sales taxes?
Yes. According to a study from the Wisconsin Policy Forum, many cities have sales taxes. Cities that have them are Chicago (10.25% with state sales tax), Kansas City, Kan. (9.125% with state sales tax), Kansas City, Mo. (8.85% with state sales tax), Minneapolis (8.025% with state sales tax) and Cleveland (8% with state sales tax).
More:Is Milwaukee's new sales tax higher or lower than taxes in comparably sized cities?
What does the new sales tax apply to?
Nothing would change regarding what the sales tax is and is not applicable to. Taxable items include, but are not limited to:
- Clothing
- Motor vehicles
- Electronics like computers, printers, and TVs
- Office equipment
- Furniture
- Home appliances like dishwashers, washing machines and dryers (with exceptions)
- Electricity (with exceptions)
- Gas (with exceptions)
- Water (with exceptions)
- Certain services like laundry and dry cleaning, boat docking, and parking for motor vehicles and aircraft
What does the new sales tax exclude?
The exemptions for the proposed sales tax change would be no different than those items exempt from the current sales taxes.
Items include, but are not limited to:
- Food and food ingredients except candy, soft drinks, dietary supplements, and prepared food; Food for direct consumption on the premises, such as meals sold in restaurants, cafes, and cafeterias, is taxable; dried fruit
- Bottled water, water sold through public water mains
- Meals furnished by institutions of higher education
- Fuel and electricity for residential use, biomass used for residential fuel; deer and other cervids sold to hunting preserves
- Motor fuels; vegetable oil and animal fats converted to exempt vehicle fuels
- Fuel and electricity used in manufacturing
- Fuels converted to electric energy, gas or steam by utilities
- Waste treatment facilities and machinery and equipment used in recycling
- Mobile and manufactured homes
- Newspapers, subscription periodicals and shoppers guides; catalogs and catalog envelopes
- Caskets and burial vaults
- United States of America and State of Wisconsin flags
- Self-service laundry and dry cleaning services (list here)
- Prescription drugs (excluding insulin), insulin for the treatment of diabetes and supplies for blood sugar testing
- Commercial vessels and barges
- Containers, labels, sacks, cans, boxes, and other packaging and shipping materials
- Restaurant employee meals
- Servers and computers used in commercial printing
- Amusement devices - video and electronic games
- Tournament or league entrance fees
There is a full list of exempt items on the state Department of Revenue website as well as more information.
How much money are the sales taxes expected to generate?
The Department of Revenue has estimated that the additional city sales tax (2%) would generate $193.6 million in revenue and the additional county sales tax (0.4%) would generate an additional estimated $82.2 million in revenue on top of the 0.5% tax already in place in the first year.
The county received $96.3 million in sales tax revenue in 2022, $90.1 million in 2021 and $79.9 million in 2020, according to state Department of Revenue data on county sales tax distributions.
Alison Dirr and Vanessa Swales contributed to this report.
Drew Dawson can be reached at ddawson@jrn.com or 262-289-1324.