MADISON, Wis. — Insurance lobbyist and business owner Chris Hanson admitted Thursday she is using corporate tax loopholes to reduce the taxes paid by her insurance business. The loophole deployed by Hanson allows her business to be taxed at a rate much lower than the state’s corporate tax rate, costing the people of Wisconsin badly-needed revenue.
“Only an out-of-touch insurance lobbyist like Chris Hanson would wear her use of corporate tax loopholes to avoid paying her business’s fair share as a badge of honor,” said Scot Ross, One Wisconsin Now Executive Director. “It’s clear Chris Hanson’s desire to cut the income tax rate for the top one percent of income earners isn’t just business as usual, it’s personal.”
Hanson’s admission came in response to a One Wisconsin Now investigation showing her insurance business, Hanson Benefits, Inc. has paid no state income tax since its creation in 2003. Hanson said in a Thursday press release that her company is established as an S-Corporation, allowing her to pay her business taxes through her personal income tax return.
The current Wisconsin state corporate tax rate is 7.9 percent. By using the S-Corporation loophole, Hanson’s business income is taxed at the personal income tax rate, which means the highest rate her business income would have been taxed prior to 2009 is 6.75 percent. In 2009, the state legislature increased the rate for the top one percent of income earners, those making more than $225,000 a year to 7.75 percent. This was the first income tax increase to the top one percent in 40 years.
Hanson has criticized some necessary revenue increases signed into law by the Governor to avoid slashing badly-needed funds for education, health care, police and fire protection in light of the national economic collapse.
Hanson has specifically attacked the closing of the so-called “Las Vegas Loophole” that allowed banks and corporations to avoid paying nearly $200 billion a biennium in taxes, as well as the reduction in the capital gains exemption. Over 70 percent of capital gain benefits go to people earning more than $200,000 a year. [Appleton Post-Crescent, 10/11/10]
“It’s bad enough Chris Hanson uses a corporate loophole to save herself money,” said Ross. “But her ideas about cutting nearly $200 billion from our schools, health care, police and fire protection to reopen the ‘Las Vegas Loophole’ are completely irresponsible and bad for Wisconsin families.”