On March 17, the Wisconsin Senate passed Assembly Bill 461, a bipartisan bill to allow Wisconsin residents to subtract overtime pay from their state income taxes. While we favor across the board rate cuts, keeping money in the pockets of hard-working Wisconsinites is crucial at a time when the costs of food and energy continue to rise. Importantly, the Legislative Fiscal Bureau estimates that the state will end the current biennial budget cycle with a surplus of more than $2.3 billion, and AB 461 makes progress by returning some of that money to the Wisconsin taxpayers who earned it.

The non-partisan Tax Foundation ranks Wisconsin number 21 overall on its State Tax Competitiveness Index. However, this rank is boosted by more favorable sales and property taxes. On income taxes, Wisconsin ranks only 34, well below nearby states like Michigan, Iowa and even Illinois. The state’s tax surplus alone is evidence that Wisconsinites are overburdened by the taxes they pay, and this legislation will return $176 million back to workers this year alone and $150 million per year going forward. AB 461 will move the state a step in the right direction and make it slightly more competitive with its neighbors.

State tax competitiveness is closely linked with domestic migration rates and a policy change like this one could prove to be a draw for workers in neighboring states. Making Wisconsin a favorable location for manufacturing and other businesses to thrive, and a destination for the workers those businesses will need, should be a high priority for state policymakers and will be a boon for the state’s economy in future years. In fact, in its testimony in support of the bill Wisconsin Manufactures & Commerce, which represents approximately 3,800 companies in the state, called this “a common sense policy that strengthens Wisconsin’s economy and supports workers,” and noted that Wisconsin needs this policy remain competitive. 

Above all, the legislature and Governor Evers should build on the work AB 461 will accomplish and consider additional tax relief solutions to return the budget surplus to hard-working taxpayers. Such changes will make further progress in restoring Wisconsin’s competitiveness with its neighbors and benefit all Wisconsinites.

This legislation puts money back in the pockets of workers, strengthens independent businesses, and supports a free-market economy where productivity and initiative are rewarded — not taxed. It’s a win for families, employers, and Wisconsin. For all of these reasons, Governor Evers (who is in need of a signature achievement this session) should sign AB 461 into law.

With the start of Spring Training, and the regular season just around the corner, Merrill Kelly’s decision to sign with the Arizona Diamondbacks instead of the San Diego Padres is more than a baseball story; it’s a case study in how tax policy shapes real‑world choices. In a recent interview, Kelly didn’t mince words about the California: “They take too much money out of my pocket, man. The taxes over there are a different level.”

California politicians and commentators often insist they can legislate without consequence, but Merrill Kelly exposed the truth: incentives matter, and California’s tax code is driving people, including elite athletes, away. Kelly’s choice mirrors a larger trend. We recently highlighted how California has experienced significant outward migration in recent years, driven by high taxes, high costs, and regulatory burdens that make it harder for families and businesses to stay. To put it bluntly, when a state makes it expensive to live or work there, people leave. Like the high-profile tech entrepreneurs fleeing the state, professional athletes like Kelly are simply another visible example because their salaries make the math impossible to ignore.

The Math Behind Kelly’s Decision

In December, Kelly signed a two-year contract with the Diamondbacks worth $40 million, meaning $20 million per season. On a $20 million salary, California’s top marginal income tax rate of 13.3 percent would cost Kelly more than $2.6 million per year. In Arizona, with a flat 2.5 percent tax rate, the taxes would only amount to about $500,000. That’s a more than $2 million difference annually on income taxes alone. California’s additional taxes (1.3 percent State Disability Insurance tax and higher effective property tax rates, among others) would grow the disparity by several hundred thousand dollars more. In total, Merrill Kelly will end up keeping almost $2.5 million more per season just by signing with the Diamondbacks instead of the Padres. This comes as no surprise given that the Tax Foundation ranks California as 48 on its state tax competitiveness index, 34 spots lower than Arizona.

Arizona isn’t just a low‑tax state. It’s a state where baseball is a major economic driver and players like Kelly contribute to a broader sector that benefits residents, businesses, and local governments. The Cactus League is one of Arizona’s most important annual economic events. The Common Sense Institute projects that out‑of‑state visitors will spend between $210 million and $590 million during the current five‑week spring training season, generating $210 million to $953 million in GDP and supporting 668 to 9,697 jobs statewide, with more than 1 million fans across ten stadiums. It’s a major seasonal economic boost for restaurants, hotels, retailers, and transportation providers across the Valley.

Additionally, when a team like the Diamondbacks remains competitive and makes a deep postseason run, or even makes it to the World Series like the Diamondbacks did in 2023, the economic impact multiplies. Hosting World Series games drives major tourism spending, national media exposure, and local business activity, bringing surges in hotel occupancy, restaurant revenue, and regional visibility that can’t be replicated by ordinary tourism campaigns. In other words, keeping good players like Merrill Kelly isn’t just good for the Diamondbacks. It can be a boost for Arizona’s economy.

On the other hand, the Padres have never won a World Series and haven’t played in one in 28 years. It will remain a challenge when every contract they offer comes with a built‑in penalty: California’s tax code. California doesn’t just discourage people from moving there. It punishes them for showing up. States that let people keep more of what they earn will attract talent. And states that don’t will lose talent, whether professional athletes or entrepreneurs. When you tax success at the highest rate in the country, like California, people will choose to succeed somewhere else.

Wisconsin Governor Tony Evers this week used his final State of the State address to take a victory lap, devoting most of his remarks to praising his own record rather than outlining meaningful solutions for the challenges facing Wisconsin. The speech echoed a familiar pattern: expansive claims about past accomplishments, vague promises about future priorities, and a conspicuous lack of substantive policy proposals. For a governor nearing the end of his tenure, the absence of a clear roadmap was striking.

Evers repeatedly highlighted the number of bills he signed, the dollars he spent, and the programs launched under his administration, but empty statistics are not the same as actual results for Wisconsin. Many of the issues he raised, including education funding, remain unresolved after his eight years in office. The governor’s self‑congratulatory tone stood in sharp contrast to the limited substance of his proposals. Rather than offering concrete solutions to affordability, public safety, or government spending, Evers largely recycled talking points from previous years. His address leaned heavily on rhetoric about “bipartisanship,” even as lawmakers have increasingly been forced to turn to constitutional amendments to bypass Evers’ vetoes.

One such amendment aims to undo Evers’ infamous 400‑year partial veto, which extended school funding increases until the year 2425 by removing individual digits of a bill passed by the legislature. Evers defended the veto during his address and denied it would lead to higher property taxes, despite the obvious implications of a veto designed to override legislative intent for centuries.

Light on Solutions, Heavy on Spending

Evers’ policy proposals in the speech were modest at best. His new initiatives—including a plan to increase green energy purchases and a domestic‑violence awareness partnership with the Milwaukee Bucks—may be well‑intentioned, but they do little to address the structural issues he spent the rest of the speech warning of. He emphasized his record on tax cuts but did nothing to move the legislature in favor of proposals that will conform state tax law with recent federal changes on issues like taxing tips and overtime pay and bring additional relief to Wisconsin taxpayers.

On education, he again called for “fully funding” schools while hiding behind his 400-year veto and without offering any plan to improve outcomes or accountability for Wisconsin students. Importantly, Evers also provided no meaningful strategy to reduce regulatory burdens or expand economic opportunity.

One of the most telling moments of the speech was Evers’ threat to call the Legislature into a special session later this year if the legislature did not move forward with his preferred approach to blocking partisan gerrymandering. This was framed as a call to action, but in reality it underscored his reliance on procedural pressure rather than persuasion or consensus‑building. Special sessions have become a political tool for Evers to generate headlines and cast blame, not advance workable policy.

In the end, Evers’ final State of the State address was less a policy speech than an act of self-promotion. It celebrated spending, recounted past initiatives, and leaned heavily on self‑praise. What it did not do was offer Wisconsin a clear vision for the future or meaningful solutions to the challenges the state faces.