Springfield, Ill. – Tuesday, Governor JB Pritzker and Democrat leaders of the General Assembly announced a major step forward towards a graduated state income tax. The lawmakers introduced the language to which they would like to see the Illinois Constitution changed. Soon after, opponents responded.
Governor Pritzker says his proposed fair income tax would address the state’s multi-billion-dollar budget deficit by raising taxes only on those making more than $250,000, who represent only 3% of taxpayers.
“Working with the General Assembly, my administration is taking an important next step to change our tax system to be more fair to the middle class,” said Governor JB Pritzker. “The action we’re taking today means we are one step closer to giving voters a choice about whether the wealthy will pay more and 97% of families will pay the same or less. I’ve said from the beginning that it doesn’t make sense that I pay the same rate as a teacher or first responder, and today brings us closer making Illinois’ tax system fair.”
The wording change proposal is:
But those opposed to the wording change gave specific reasons for their resistance.
“Governor J.B. Pritzker is a tax-hiking hypocrite," IL GOP State Chairman Tim Schneider said in a statement. "He’s pushing an indefinite number of tax hikes on Illinois families and businesses, yet he dodged hundreds of thousands of dollars in property taxes on his own Chicago mansion. An independent watchdog called Pritzker’s property tax dodge a ‘scheme to defraud.’
"And we all know how Pritzker offshores his business interests in the Bahamas to dodge taxes. That only scratches the surface of Pritzker’s tax-dodging schemes. When J.B. Pritzker pays his fair share, then he can sincerely ask Illinoisans to pay more. Until then, he should stop pushing tax hikes.”
The Illinois Chamber of Commerce said Pritzker's proposed amendment (SJRCA1) will "not fix our state's current fiscal crisis, but will discourage entrepreneurs and facilitate unbridled tax increases on our middle class."
The Chamber's President and CEO Todd Maisch testified in opposition at Tuesday's Senate Executive Committee hearing.
"We understand the governor has inherited serious financial problems. However, there is no way the administration can tax its way out of those problems solely through increasing taxes on the "wealthy." Regardless of the stated purpose of this constitutional amendment, the middle class will certainly be included in higher tax brackets in the future, because there simply isn’t enough money in the top three percent of earners.
"Secondly, this amendment clearly discourages entrepreneurs in Illinois whose success is our best chance at economic and revenue growth in our communities. Finally, the Illinois constitution currently states only one tax can be levied on income. This amendment removes that language, creating a situation where the government can tax your income multiple times for multiple purposes," Maisch said.
The Illinois General Assembly would need to approve the proposal to be on the next General Election ballot in 2020. If the state's voters pass the amendment, it would then remove Illinois' flat tax and insert the graduated tax plan.