WMC Wants Another Business Tax Break
Bill increases construction industry tax exemption; pushed by legislator whose business will benefit.
Business and construction interests are backing a GOP plan that would expand a sales tax exemption on materials used in construction projects.
There already is an exemption for materials in a so-called lump sum contract, which is normally used in the construction industry to reduce design and contract administration costs. It is called a lump sum because the contractor is required to submit a global price instead of bidding on individual items.
This tax break, created in 2013, applies if the total sales price of the taxable products is less than 10 percent of the total contract price.
Under Senate Bill 273 and Assembly Bill 340, the exemption would be expanded to apply to all construction contracts if the total sales price of the taxable products is less than 10 percent of the total contract price. The bill also provides that, if a contract qualifies for the exemption, the exemption applies to all subcontracts.
The price tag for a similar proposal in Republican Gov. Scott Walker’s proposed 2017-19 proposed budget, which the GOP-controlled legislature is now reviewing, is $2.75 million over two years.
The measure was authored by GOP Sen. Roger Roth, of Appleton, whose family owns a construction business, and Rep. Rob Stafsholt, of New Richmond. Stafsholt is a farmer and owns a residential rental business and a salad and food dressing company.
The proposal is backed by business and construction interests led by Wisconsin Manufacturers & Commerce (WMC), the state’s largest business organization and a major lobbying and electioneering force. Overall, WMC has spent an estimated $18.6 million since 2010 on undisclosed, outside electioneering activities to support Republican and conservative legislative and statewide candidates.
In addition to secret, outside spending on elections, WMC also represents more than a dozen special interests, including business, real estate, manufacturing, and construction, contributed $16.7 million between January 2011 and December 2016 to Republican legislators.
Roth, who was elected to the Senate in 2014, accepted about $274,600, or 66 percent, of his large individual and PAC contributions from January 2013 through December 2016 from employees of WMC-represented interests. Among Roth’s top contributors were individuals and couples who gave him $2,000 each during that time, including:
Thomas Radtke, of Winneconne, president of Bob Radtke Inc.;