Milwaukee Common Council approves 2 percent sales tax to avoid a financial crisis

The tax passed with a 12-3 vote

The Milwaukee Common Council voted 12-3 on Tuesday, July 11, 2023, to approve a higher sales tax. That was two more than the two-thirds majority needed to pass. Voting ‘no’ were council members Andrea Pratt, Mark Chambers, Jr., and Milele Coggs.

The sales tax in Milwaukee will go up 2 cents per dollar as of January 1, 2024.

City leaders who pushed for approval of the higher sales tax warned of looming deep cuts to core services, including police and fire protection. Opponents objected to strings attached to additional state funding, including curbing spending on diversity, equity and inclusion efforts.

Milwaukee is struggling with an underfunded pension system and insufficient money to maintain essential police, fire and emergency services. Milwaukee has increasingly become reliant on federal pandemic aid to fund its essential services, which city leaders have said cost $150-million more per year to maintain.

The state sales tax is 5 percent. If the county goes along with the city and approves the higher sales tax rate, sales taxes in the city of Milwaukee would be 7.9 percent.

The additional sales tax in the city of Milwaukee will bring in nearly $200-million more in revenue next year, which the city has to use to pay for its pension and to increase the number of police officers and firefighters.

Milwaukee was the only city of its size in the country without the power to raise its own sales tax before the Legislature granted it the power to raise the rate by 2 percent.