Everything you need to know about the new Milwaukee, Milwaukee County sales tax

 

MILWAUKEE (CBS 58) --- The expected sales tax increase in Milwaukee County and the City of Milwaukee officially goes into effect Monday, Jan. 1st.

For big ticket items like cars, you'll see a slight spike in the overall price you pay, while most people likely won't notice the difference for everyday items they purchase.

Gary Witt, CEO of The Pabst Theater Group says the tax increase won't deter people from enjoying downtown restaurants or entertainment. "A city has to be able to have the amenities that people want," he said.

Over the summer, both the city and the county voted to raise sales taxes. Here's what you need to know:

WHAT'S CHANGING ON JANUARY 1ST?

• Existing Wisconsin state sales tax will stay at 5%
• Milwaukee County sales tax will increase from 0.5% to 0.9%
• The City of Milwaukee will add a 2% sales tax

Total sales tax effective Jan. 1:

-Milwaukee County (all but city of Milwaukee): 5.9%

-City of Milwaukee: 7.9% (a 2.4% increase from the previous 5.5%)

WHY IS SALES TAX INCREASING?

Supporters of the sales tax increases on the city and county levels have said that this was needed to make up for major shortfalls in Shared Revenue dollars sent from the state. In simple terms, Milwaukee County and the City of Milwaukee say they aren't getting enough money from the state to keep up with costs, including critical services like the county transit system, parks, roads, and other important programs. The goal is to use revenue from the new taxes to help supplement for dollars that aren't coming in from the state.

WHAT TAXABLE ITEMS WILL BE IMPACTED?

The percentage you pay in sale tax is the only thing changing, not the items that are taxed. The same items you already pay taxes on will apply. Some examples include: 

• Cars
• Furniture
• Electronics
• Clothing
• Restuarant meals

WHAT'S EXCEMPT?

Items that were previously tax exempt will remain tax exempt. 

• Groceries, except prepared food, candy, and soft drinks.
• Prescription drugs and certain medical equipment.

Click here for more information from the Wisconsin Department of Revenue

HOW WILL THIS IMPACT HOW MILWAUKEE COMPARES TO OTHER CITIES?

Even with the tax increase, Milwaukee's sales tax is still lower than nearby cities like Chicago which sales tax currently sits at 10.25%.

Visit Milwaukee told CBS 58 it does not believe the tax increase will negativity impact tourism, which has seen a boost in recent years.

"We are still a very attractive destination to visitors like Chicagoans who know that they can do more and spend less money in the same amount of time in Milwaukee, compared to even staying home or going to downtown Chicago," said Claire Koenig, Visit Milwaukee's Senior Director of Communications.