The start of a new year means that the Wyoming Legislature will soon be in session, convening on Jan. 12. One of the main topics this year facing lawmakers will be how to deal with …
The start of a new year means that the Wyoming Legislature will soon be in session, convening on Jan. 12. One of the main topics this year facing lawmakers will be how to deal with the unprecedented fiscal crisis confronting the state.
Unfortunately, in the Joint Committee on Revenue hearings in November and December, legislators showed our Legislature’s inability to get serious about the economic disaster that is looming on the horizon for all of us. Their collective decision to not push forward a bill focused on implementing an income tax against the highest earners in the state is going to force cuts into key programs, like education and social programs, which are the foundation for the future of Wyoming.
It’s easy to understand that most Wyomingites, and people in general, are against any type of taxation, whether it’s on income, real estate transactions, etc. Who really wants to give up more of their hard-earned dollars to state tax collectors when the mean income of a Wyoming resident is $64,000?
However, when millionaires and billionaires are buying multimillion dollar homes in Teton County, in part to shelter their assets from taxation, there is a fundamental problem with the tax code in Wyoming. As Justin Farrell, a professor from Yale and a native of Wyoming, writes in his recent book Billionaire Wilderness: The Ultra-Wealthy and the Remaking of the American West, “All things being equal, a household making $10 million in annual income could potentially save around $700,000 every year just by relocating at least part time from Connecticut to Wyoming.”
He also identifies Teton County as having the highest per capita income of all 3,144 counties in the United States ($194,485) and that nearly $8 out of every $10 in 2015 income tied to the county was from financial interest and dividends. With no formal set of residency requirements for tax purposes it is no surprise that Teton County regularly, according to the U.S. Census Bureau, has the nation’s largest discrepancy between the number of people claiming to live in Wyoming and those who actually live here.
While it’s easy to pick on Teton County, the trends of income disparity apply across the state. As Farrell highlights, a 2016 report from Stanford University shows that the top 1% of earners in Wyoming owns 50% of the wealth and the top 10% of earners control 65% of total income. This is the highest of all 50 states.
After reviewing the facts there is absolutely no reason why our state shouldn’t pass legislation requiring those who make more than $1 million a year to pay a 4-5% income tax.
And while I’ve highlighted opportunities on implementing a fair income tax code, other potential revenue streams for our state include a targeted real estate tax and a corporate income tax, which almost passed last year. Our state has some serious revenue issues and our elected leaders to need to show courage and fortitude in dealing with the issue.
Only time will tell if they rise up to the challenge or be the latest group of leaders who kick the problem down the road.