NAPERVILLE – Americans for Prosperity Illinois called on legislators to reject the graduated income tax and State Rep. Lou Lang's Progressive Income tax plan, because "it will feed the General Assembly’s problem of over-spending by giving them a consistent target on which to continually hike taxes."
The eventual result, AFP-IL says, would be higher taxes on most Illinoisans and fewer jobs due to outbound migration of job creators.
“While it is being sold as a magic cure for what ails the state, the long-term effect of Rep. Lang’s progressive tax plan would be disastrous,” said Americans for Prosperity Illinois State Director David From. “Hiking taxes initially on higher income brackets will increase the tax burden on many employers and small businesses, while also giving the General Assembly an ATM from which they can continually feed their spending habit by playing class politics and demonizing the wealthy with little public resistance.
"Unfortunately, the story of the progressive income tax shows that middle class taxpayers are the ones who eventually really pay.”
The group argues that a graduated income tax would give politicians the ability to add brackets, increase the rates or lower the income threshold at which higher rates apply.
Among the 34 states (and the District of Columbia) with a graduated income tax, Illinois’ median household income ($57,444) would be taxed at a top marginal rate of 5.46%, nearly two full percentage points higher than the current 3.75% flat income tax. The average number of brackets is six.
"This bill is a Trojan Horse, intended to serve as a mere placeholder until much higher rates can be adopted at a more politically convenient time," AFP-IL says.
The Lang Rate Schedule, outlined in HB 689, would give Illinois the fourth-highest top marginal rate in the country (behind California, Oregon & Minnesota for single filers). The $1.9 billion in anticipated revenue covers less than 50 percent of the deficit of the Democrats’ most recently-passed budget.
Speaker Madigan’s so-called "Millionaire’s Tax" would place an additional 3 percent surcharge on income over $1 million and tax those with over $1 million in taxable income a top marginal rate of 12.75%, the second-highest in the nation.
Still, the speculated $2.9 billion would still leave more than 25 percent of the state's budget deficit unfunded.
“The reality that this tax hike does not come close to paying for the budget that the Democrat majority passed last year, shows that the proposed rate schedule isn’t their real objective,” continued From.
“Under the guise of ‘a tax cut for 99% of Illinois taxpayers,’ once passed the good people of Illinois will be bamboozled by seeing more brackets with lower thresholds and higher marginal rates implemented. Illinoisans should not be asked to entrust Springfield politicians with – literally – a blank check.”
