As the country continues to recover from inflation that saw a 40-year peak in 2022, tax cuts in the recently passed Wisconsin Budget and President Trump’s ‘Big Beautiful Bill’ are set to bring relief to lower and middle income Wisconsinites. 

The Wisconsin budget, signed into law on July 3rd, will provide $1.5 billion in total tax relief to Wisconsin residents, including $1.3 billion in income tax cuts.

Republicans in the state legislature touted the passage of the budget as the second largest income tax cut in the state’s history.

In addition to providing relief as inflation continues to decrease, it will make Wisconsin a more competitive environment for low and middle income families to move to, as 30 out of 41 states with an income tax currently have lower tax rates on moderate incomes. (RELATED: UW Regents Unanimously Approve Third Straight Tuition Increase)

“A large number of lower-income Wisconsinites are currently exposed to Wisconsin’s second-highest rate,” said Katherine Loughead, who is research manager at the Tax Foundation’s Center for State Tax Policy.

The cuts will reduce taxes for many lower to middle income Wisconsinites by almost 20%, from 5.3 percent to 4.4 percent of their income.

In addition to providing tax cuts for many Wisconsin residents, the $111 billion budget will provide more funding for special education in public schools and for the University of Wisconsin.

The budget was the product of a compromise between the legislature, where both chambers are currently controlled by Republicans, and Democratic Governor Tony Evers.

In the Senate, 14 Republicans voted for the budget compared to only 5 Democrats, indicating that Evers was forced to defer to Republicans on a number of key issues and that many within his own party were dissatisfied with the budget. (RELATED: Republican Businessman with Questionable History Enters Gubernatorial Race)