Welcoming the New Year also meant welcoming the Fiscal Cliff, willingly or not.
For the country as a whole, this means higher tax rates for incomes of $113,700 and below and an increase in the tax rate of singles making more than $400,000 and couples making over $450,000 from 35 percent to 39.5 percent, according to Anne Alexander, Director of International Programs, who has been researching the fiscal cliff with economics professor Robert Godby.
Taxing on investment income also hit an increase from 15 percent to 23.8 percent for those in the top income bracket. A 3.8 percent surtax for singles earning more than $200,000 and couples earning over $250,000 on investment income has also been put in place.
Specifically, though, how does the Fiscal Cliff impact Wyoming?
“The average Wyoming income is around $40,000 per year, so the payroll tax holiday ending translates to about $580 extra tax paid out in payroll taxes per year for your average Wyomingite,” Alexander said.
However, the largest impacts for Wyoming have yet to happen and will not become present until February or March.
The debt ceiling debate will return in the coming weeks, as Congress decides whether to raise that to pay our existing bills. The expenditures cuts were originally structured in August 2011 to target only discretionary spending. This means mandatory spending, Medicare, Medicaid, Social Security, and interest on the national debt are not targeted in sequester.
A focus on discretionary spending includes every other program in the federal government, the largest piece being defense spending which is 67 percent of discretionary spending.
A few things that could be impacted in Wyoming in the coming months include F.E. Warren Air Force Base and Wyoming National Guard spending, National Parks operations, and federal permitting, Alexander said.
Like individuals across the country, though, Wyomingites are already experiencing at least a two percent decrease in their pay due to taxes.
