Why It Matters
Wisconsin Governor Tony Evers has vetoed a package of Republican-backed bills that would have reshaped state tax policy and immigration enforcement cooperation. The vetoes affect workers across Wisconsin who earn tips or overtime wages, local county governments, and public school funding mechanisms.
The decisions highlight ongoing policy clashes between the Democratic governor and the Republican-controlled state legislature, with implications for how Wisconsin aligns — or declines to align — with federal tax and immigration priorities.
What Happened
Governor Evers formally rejected several bills passed by Wisconsin’s Republican legislature, including measures that would have eliminated state income taxes on tips and overtime pay, required county governments to cooperate with federal Immigration and Customs Enforcement (ICE) agents, and overturned Evers’ so-called “400-year veto” that had previously secured school revenue limit increases.
The tax exemption bills, Senate Bill 36 and a companion overtime measure, were introduced by GOP lawmakers to align Wisconsin’s state income tax policy with provisions in a federal tax and spending bill signed by President Donald Trump in July 2025. That federal law allows tipped workers earning less than $150,000 annually to deduct up to $25,000 in tips from their federal taxable income, and permits certain overtime-eligible employees under the same income threshold to claim a comparable deduction.
Evers did not oppose the concept of eliminating taxes on tips outright. His own 2025–27 state budget proposal had included a similar provision — but as a permanent policy change. The Republican bill included a sunset date of 2028, tying the exemption’s duration to the temporary federal framework.
“We should not be at the whims of a Republican-controlled Congress that has no problem gutting basic necessities and services like food and access to healthcare just to pay for tax cuts for millionaires,” Evers said in a statement explaining the veto.
On immigration enforcement, the vetoed bill would have mandated that Wisconsin counties actively cooperate with ICE agents on detention and deportation activities — a measure that would have affected jurisdictions that have adopted more limited engagement policies with federal immigration authorities. Federal immigration enforcement priorities have shifted significantly since Attorney General Pam Bondi’s recent departure and the appointment of an acting replacement at the U.S. Department of Justice.
By the Numbers
$25,000 — Maximum annual tip deduction allowed under the federal law that Wisconsin Republicans sought to mirror at the state level.
$150,000 — Income threshold under which workers qualify for both the federal tip and overtime deductions.
2028 — Sunset date included in Senate Bill 36, the Republican tip tax exemption bill, which Evers cited as a key reason for his veto.
400 years — The duration of Evers’ earlier budget veto that extended school revenue limit increases, which Republicans sought to reverse through the vetoed legislation.
3 — Distinct policy areas addressed by the vetoed package: income tax exemptions, immigration enforcement cooperation, and school funding authority.
Zoom Out
Wisconsin is not alone in grappling with how to respond to federal tax and immigration policies emanating from Washington. Several Republican-led states have moved quickly to align their tax codes with the 2025 federal legislation on tips and overtime, while Democratic governors in states including Michigan and Minnesota have expressed reservations similar to those voiced by Evers.
The push to require local and county cooperation with ICE is also playing out nationally, as the Trump administration has pressured so-called sanctuary jurisdictions to participate more actively in federal immigration enforcement. Disputes over federal agency funding and operations have added further complexity to intergovernmental coordination on immigration.
Wisconsin’s 2026 political landscape adds urgency to these clashes. Upcoming state elections are expected to reshape legislative, judicial, and executive power in Wisconsin amid a wave of retirements, meaning the balance of power that determines whether future vetoes can be overridden may shift significantly.
What’s Next
Republican legislative leaders have not yet indicated whether they will attempt to override Evers’ vetoes, which would require a two-thirds supermajority in both chambers — a threshold the GOP does not currently hold. Lawmakers may reintroduce revised versions of the bills in future legislative sessions.
Evers has called on the legislature to consider permanent, standalone tax relief for tipped and overtime workers rather than measures tied to the federal timeline. Whether bipartisan negotiations on that front are possible remains to be seen ahead of the 2026 elections.