Figuring out sales taxes is about to get a lot more complicated.
For the past three years, the Milwaukee region has had three easy-to-remember sales tax rates: 5% on all taxable purchases in Waukesha County, 5.5% on most other taxable purchases in the four-county area and 6% on restaurant food, candy and beverages in Milwaukee County.
But on Jan. 1, the number of tax rates will double, to six, with the highest at 8.4%. Under a new state law, Milwaukee will impose its first-ever city sales tax and Milwaukee County will raise its sales tax, to avoid the budgetary catastrophe known as a “fiscal cliff.”
It’s time to pick your Milwaukee favorites for the year!
Here’s how the state and local tax rates stack up:
State: Wisconsin has charged 5% tax on most purchases since 1982. Most groceries and prescription drugs aren’t taxable, but candy and beverages are. Anything exempt from state sales tax is also exempt from local sales taxes.
City: Starting Jan. 1, Milwaukee will collect a 2% sales tax.
Counties: Milwaukee, Ozaukee and Washington counties each collect a 0.5% sales tax, while Waukesha County is one of just four Wisconsin counties without its own sales tax. On Jan. 1, Milwaukee County’s tax rises to 0.9%. Another tax collected across Milwaukee County is for the Wisconsin Center District (owner of Fiserv Forum, the Baird Center, UW-Milwaukee Panther Arena and Miller High Life Theatre), which gets a 0.5% tax on restaurant food, candy and beverages.
All of those taxes piggyback on each other. For example, if you buy a soda in the city of Milwaukee, you will pay state, county and Wisconsin Center District taxes in addition to the new city tax – a total of 8.4%.
Combined, the new lineup of sales tax rates will be:
- 8.4% at restaurants and on candy and beverages in Milwaukee
- 7.9% on other taxable purchases in the city
- 6.4% at restaurants and on candy and beverages in Milwaukee County suburbs
- 5.9% on other taxable purchases in Milwaukee County suburbs
- 5.5% on all taxable purchases in Ozaukee and Washington counties
- 5% on all taxable purchases in Waukesha County
