TAX REFORM BILL – HOW WILL IT BENEFIT THE RATEPAYER?

The recently enacted Tax Reform Bill will, among other things, reduce the corporate income tax rate from a maximum of 35 percent to a flat rate of 21 percent for tax years beginning after 2017. On January 10, 2018 the Public Service Commission of Wisconsin (PSC) issued a request that each utility provide comments on how it proposes to implement changes resulting from the Tax Reform Bill for the benefit of ratepayers. The PSC estimates that the utilities will over collect from customers between $190 and $198 million, because the rates customers are currently paying are based on the revenue requirement at the higher tax rate. All of the Wisconsin utilities, along with consumer groups have submitted initial comments. The comments from the utilities suggest a variety of alternative approaches including: customer bill credits, use of savings for capital improvements, addressing the issue in future rate cases, and reducing pre-existing deferred balances. The consumer groups advocated for returning the savings in the form of a bill credit. The commission is currently considering various alternatives and has not yet issued a final order.

Comments are closed.