As Wisconsin communities seek innovative solutions for financing transportation infrastructure, the local wheel tax has emerged as a popular tool. This tax, added to the state’s annual vehicle registration fee of $85 for automobiles, is being increasingly adopted across the state.
Initially adopted by only four communities in 2011, the wheel tax has now been embraced by 51 municipalities and 14 counties, according to a report by the Wisconsin Policy Forum (source). This tax is earmarked for “transportation-related purposes” by state law.
Over the past year, 10 more municipalities have joined the ranks of those implementing a wheel tax, noted Tyler Byrnes, a senior research associate at the Wisconsin Policy Forum. Despite recent legislative efforts to boost local government funding, this tax remains a critical tool for many communities (source).
“This is further evidence of the few opportunities municipalities have to fund critical local services beyond, say, the property tax,” explained Zach Vruwink, chief operating officer at the League of Wisconsin Municipalities. State-imposed limitations on property tax increases (source) often constrain local governments, making alternative revenue sources essential.
Jason Stein, president of the Wisconsin Policy Forum, highlighted the importance of the wheel tax: “So every dollar that a city or a county raises from its wheel tax is a dollar that they don’t have to raise from somewhere else to pay for the roads, to pay for transit — some of these transportation priorities.”
Across Wisconsin, the wheel tax varies from $10 to $40 per vehicle. In 2024, these taxes contributed $66.7 million in revenue, according to research by the Wisconsin Policy Forum (source).
Eau Claire and Milwaukee Propose Wheel Tax Increases
Both Eau Claire and Milwaukee are exploring increases to their local wheel tax. Eau Claire’s city manager, Stephanie Hirsch, has suggested raising the tax from $24 to $50 in the 2026 city budget, a move expected to generate over $1 million in revenue (source).
Hirsch acknowledged the impact on residents, stating, “Knowing this, we continue to work to spend every dollar with as much care as possible to maximize the impact on local services and minimize the impact on residents.” If enacted, this increase would result in Eau Claire residents paying $165 annually in vehicle registration fees, considering the county’s $30 wheel tax.
In Milwaukee, Mayor Cavalier Johnson has proposed a $10 increase, bringing the local tax to $40. This adjustment could raise an additional $2.7 million for the city’s 2026 budget. Johnson emphasized aligning Milwaukee’s tax with other Wisconsin communities in his address to the Milwaukee Common Council.
Milwaukee Alders Express Concerns
Approval from the Milwaukee Common Council is required to enact the proposed tax hike. Some council members, including Alder Larresa Taylor, have expressed reservations, citing the added financial burden on residents. Taylor remarked, “That’s another burden that we’re putting on our residents, our citizens.”
Alder Peter Burgelis stressed the importance of community input before the final decision, stating, “I don’t think that anyone thinks we should be investing less in our roads. This (wheel tax) is one way we can help pay for that, but the discussion can’t happen at the very last moment. We have to engage our residents.” The council is expected to vote on the 2026 budget soon.
