Who will sacrifice to fix the state budget deficit?   Ron Blascoe, Steward, AFT 4848   Wisconsin is facing an estimated $5.4 billion budget deficit and we will all be asked to sacrifice, right?  Well, no.  As usual, state employees, the poor and other working people will be expected to do most of the sacrificing while those who live off of their wealth are being offered a free ride.   A just-released report by the Institute for Wisconsin's Future shows how the state could raise an additional $4.2 billion a year by closing tax loopholes for corporations, extending sales taxes to services used by the well-off and by reinstating fair taxes on wealthy individuals.   The Catalog of Tax Reform Options for Wisconsin details 36 proposals to increase taxes, and includes how much each would raise in state revenue and who would end up paying.   So, for example, according to the report, Wisconsin currently exempts 60 percent of capital gains from taxes and last year we eliminated even a modest tax on inherited wealth.  Reinstating the inheritance tax, the tax on profits from capital gains and bringing back a progressive income tax would generate an estimated $1.8 billion a year in state revenue.   Enacting fair taxes on businesses would result in another $1.3 billion according to the report.  For example, Wisconsin is one of 27 states that allows corporations to deduct the cost of a wide range of "production activities," many of which are incurred out of state.  "The main beneficiaries are large, profitable corporations, especially oil companies."  Closing this "production activities" loophole alone would result in another $158 million a year in state revenue.           And, while you and I pay a sales tax on most things we buy, there currently is no sales tax on things like advertising services, country club memberships, fees paid to lawyers and tax accountants and a wide range of other services used by corporations and the well-to-do.  By extending sales taxes to those services, Wisconsin would take in another $932 million a year.   Another new report from the Washington-based Good Jobs First think tank exposes corporate "skimming" of state sales tax revenues.  While businesses may have had to put in some effort to collect sales taxes in the distant past, the authors note that, in the age of computerized cash registers and electronic transfers, collecting sales taxes is no burden at all.  Yet Wisconsin continues to pay businesses $22 million a year to provide this "tax collection service."   Most of the potential tax increases described in these reports are "progressive" in that people who earn more would be paying a higher percentage of their incomes.   Unfortunately, Governor Jim Doyle and many of his Legislative counterparts say they want to fix the huge state budget shortfall without raising taxes.  That can only happen if there are deep cuts in services to the public and in state employee jobs, wages and benefits.   When we think about possible tax reform options along side possible budget cuts, it becomes clear that the politicians who run things are making conscious choices that benefit those with wealth at the expense of poor and working people.  Or, maybe they just don't have the courage to do the right thing.   For example, simply reinstating the inheritance tax would bring in enough revenue to raise every W-2 family out of poverty and still have enough left over to give every member of the Blue Collar, Administrative Support, Science Professionals, WPEC, TAA, PERSA and Professional & Social Services bargaining units a 11% raise.  Taxing capital gains would raise enough money to provide health care for every private and public sector janitor in the state.   Politicians have made it clear that they intend to balance the state budget on the backs of poor and working people.  Whether that happens will depend on whether unions and our allies are able to mobilize to shift that burden back on to those who can afford to pay.   * * *   The Institute for Wisconsin's Future is a Milwaukee-based think tank.  Its Board of Directors includes AFL-CIO President David Newby and South Central Federation of Labor President Jim Cavanaugh.  Their Catalog of Tax Reform Options for Wisconsin is available at:  http://www.wisconsinsfuture.org/publications/taxes/1108WI_TaxReformOptions.pdf   The Good Jobs First is based in Washington, DC, with affiliates around the country.  Their Skimming the Sales Tax:  How Wal-Mart and Other Big Retailers (Legally) Keep a Cut of Taxes We Pay on Everyday Purchases is available at: http://www.goodjobsfirst.org/pdf/skimming.pdf