Out-of-state purchases still contribute to Wisconsin sales tax benefits

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GREEN BAY, Wisconsin (WBAY) – Many of us have spent the past few weeks, if not months, shopping for Christmas presents. In fact, when locals in our area buy from out-of-state retailers, Wisconsin still enjoys the benefits of state sales tax.

Thanks to a question from one of our viewers, Action 2 News explored for you where this money is going and why buying locally can help communities statewide.

Wisconsin sales tax is 5% on purchases of tangible items, including clothing or furniture. Prior to Wisconsin Act 10, also referred to as the “market invoice,” only about 1% of the public actually reported sales tax and out-of-state purchases they made.

“In the case of Brown County, we will then pass on that 0.5% [county sales tax] to Brown County so that they can use it to pay for various services like roads and education and the things they provide there, ”said Peter Barca, secretary of the Wisconsin Department of Revenue (DOR).

After being signed by Governor Tony Evers in July 2019, Wisconsin expanded its powers to require out-of-state retailers and market vendors to levy taxes on purchases made by people living in Wisconsin.

Now, the DOR estimates that there is about 95% compliance when it comes to reporting and collecting sales tax. Barca said it helps level the playing field for local business owners.

“I have a phrase, look at the pennies and the dollars will take care of themselves,” said the owner of the Green Bay business. IDeal Furniture, Tom Brzoski, shared. “You really have to watch every penny with a small business. Especially now with COVID, the prices are going up. We get price increases from our suppliers almost daily. “

With Act 10 in place for over two years now, out-of-state stores continue to contribute community funding like local businesses.

“It provides equity for the stores that have bricks and mortar which are often the ones that contribute to Girl Scouts, little leagues and are very involved in their communities,” Barca stressed. “It gives them equity. We think this is very important. We’re so happy it’s in place.

“It’s a trickle-down effect,” Brzoski said. “When people spend locally, whether here or in other local stores, it reverberates. As our business grows we either employ more people or buy locally. Our mattresses are made here in Wisconsin and we try to buy as much local produce as possible. [as we can]. “

Overall, Act 10 provided for a sales tax change that filtered more money into communities. A financial goal shared with family business owner Brzoski at iDeal Furniture in Green Bay, who works alongside his daughter, Kayla. The local store that found a silver lining in the pandemic with more people staying at home.

“Really, a lot of people were at the house,” Brzoski said. “They were spending their money on remodeling their houses, buying new furniture, all that sort of thing. We have seen a very steady increase.

A steady increase as the DOR has followed with sales tax throughout the state this year.

To learn more about Wisconsin DOR market policies, CLICK HERE.

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