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Question of the day

Monday, Dec 9, 2013

* The Tribune takes a look at the impact of the temporary tax increase sunset 13 months from now…

At the end of next year, what was billed as a temporary income tax hike will by law drop to 3.75 percent unless lawmakers and the governor decide to continue it.

Oddly, the income tax would be cut in the middle of the state’s budget year. That gives planners a bit of a cushion, though the expiration of the tax hike still is estimated to take $2.2 billion out of state coffers for the final six months of the budget year that starts July 1. […]

The should-it-stay-or-should-it-go tax hike question is likely to be a big issue in the race for governor. The fate of the tax hike will have a major impact on whoever is sitting in the governor’s office come 2015. That’s supposed to be the first full year of a lowered income tax and legislative budget forecasters predict a $4.8 billion loss in revenue. It’s a tough number for even the biggest budget cutter to hit.

The politicians in Springfield have a few paths: Pass a half-year budget. Stick money in lump sums rather than line items so dollars are harder to track. Tell voters the candidate for governor who wins the November election should get to shape his budget. Delay payment of more bills and so forth.

Maybe even “all of the above.”

* The Question: If a Republican is elected governor next year, what do you think he’ll do about the tax hike sunset? Take the poll and then explain your answer in comments, please.


survey tools

- Posted by Rich Miller        


39 Comments
  1. - Waffle Fries - Monday, Dec 9, 13 @ 11:41 am:

    Other - hope like heck the Democrats do it to save the budget, then criticize later..


  2. - Just Me - Monday, Dec 9, 13 @ 11:43 am:

    I disagree with the premise of this question that all the nominees will have the same approach to this issue.


  3. - Anonymous - Monday, Dec 9, 13 @ 11:45 am:

    Other: Extend the sales tax to services and institute a graduated income tax for Illinois.


  4. - iThink - Monday, Dec 9, 13 @ 11:45 am:

    Voted other-
    I think it depends on the R in office. If Rauner, he’ll let it expire and then cut to the bone rocketing the states unemployment rate.

    I get the impression Rutherford knows it needs to stay and Dillard would channel his mentor and in a fit of bipartisan ship strike a bargain keeping it around.


  5. - The Captain - Monday, Dec 9, 13 @ 11:47 am:

    Sunset. What gets lost in the debate about who the next Governor might be and what they will do about the tax increase expiring is that most of the legislators that are up for election will have to promise not to raise taxes again to get elected/re-elected so even when you see comments like the ones Rutherford has made it’s still going to be very difficult to get the GA to pass something.

    Inaction will cause it to sunset and I’m betting on inaction.


  6. - Anonymous - Monday, Dec 9, 13 @ 11:53 am:

    The question is irrelevant. The matter will be decided before the next governor takes office.


  7. - wordslinger - Monday, Dec 9, 13 @ 11:55 am:

    Support keeping it.

    Simple spin. “Wow, these Democrats screwed things up even worse that I thought….”


  8. - CircularFiringSquad - Monday, Dec 9, 13 @ 11:55 am:

    Let’s be honest until the GOPies show their draft budgets we are guessing FamerBrucey DLard et all will want the tax…it is just like Big and Blnky Jim did back in the gold old days


  9. - Linus - Monday, Dec 9, 13 @ 11:56 am:

    I voted (and fear) that most of these candidates would allow it to sunset, although it’s important to remember the example of Jim Edgar in 1990. He campaigned for governor on a platform of sticking with a temporary income-tax hike that was set to expire, because the state couldn’t afford to lose critical revenues. And he not only won, but he won reelection four years later. That’s leadership: Not ducking from the state’s most dire needs, and the facts.


  10. - Oswego Willy - Monday, Dec 9, 13 @ 11:57 am:

    What I voted for was the “Phasing”, because it might be the most “rational” of those on the table as far as options go.

    Politcally, you can still be opposed and show that there is an expiration date, but as a Governor, until you can make sure, realistically, the revenues needed can be in place, letting it completely sunset could have implications to an agenda that might need some revenues.

    A new governor needs to “know” what revenues are going to be there in the short term, as opposed to gambling “all in” with the complete sunset.

    I would make the case for the phasing if I could to the Campaigns, but, I am hoping that looking at this situation, a new Republican governor can see a benefit of the Preckwinle option.


  11. - Downstater - Monday, Dec 9, 13 @ 12:01 pm:

    Voted “sunset”
    Phasing in sounds reasonable, but in reality it will just allow for more increases in spending and more debt. If you want to generate more revenue, start taxing some forms of retirement income, above a certain level.


  12. - Chicago Cynic - Monday, Dec 9, 13 @ 12:05 pm:

    As Daniel Biss was quoted as saying, it’s simple Arithmetic. It needs to stay so I suspect it will stay and the R gov will use it to slam the Ds.


  13. - 47th Ward - Monday, Dec 9, 13 @ 12:16 pm:

    It depends on who the Republican nominee is:

    Rauner will end it. Heck, this is the entire premise of his campaign.

    Brady and Dillard know just enough about budgets that they’d probably want to phase it out gradually, hoping all the while that the General Assembly never lets them do so. They’ll use Wordslinger’s line about “Gee whiz, it’s so much worse than I thought” as if they haven’t been in Springfield voting on budgets for so many years.

    Rutherford is probably the only GOP candidate with the stones to tell it like it is and not only keep the 5% tax, but work hard to persuade others to get on board too.

    In the meantime, I think Quinn presents a budget with the tax sunsetting mid-year, and campaigns on the fear of where the cuts will be made. He won’t specify them, but he knows enough about the budget to threaten each and every interest group out there that their sacred cow is about to be gored. Or maybe not, hint, wink.


  14. - Mokenavince - Monday, Dec 9, 13 @ 12:18 pm:

    The Preckwinkle option I find acceptable. I doubt very much it would go right back to 3.75. Who ever becomes Governor we find some reason to extend it.
    We need more help with property taxes, workers comp and corporate taxes. We can do better than let surrounding States kick our butts.


  15. - zatoichi - Monday, Dec 9, 13 @ 12:24 pm:

    According to: http://www.taxpolicycenter.org/taxfacts/displayafact.cfm?Docid=406
    Here are the states around us.
    Indi 3.4%
    Kent 2.0%-6.0%
    Miss 1.5%-6.0%
    Mich 4.25%
    Wisc 4.6%-7.75%

    5% is not far off the mark. Sunset or drop the increase, and you fall back to the same old arguement - what gets dropped to cover the $5-$6B hole? Cut education when employers need more trained employees? Cut human services which are rapidly growing? Cut prisons when people want stiffer sentences? Cut medical as more people are get on ACA? Cut infrastructure - who needs roads, bridges and buildings? I have listened to local Republican pols explaining the tax and budget issues. Everything goes cut,cut,cut, sunset until the crowd is asked exactly what should go away. It’ll stay.


  16. - AC - Monday, Dec 9, 13 @ 12:27 pm:

    With the exception of Rauner, I believe the tax increase will be extended. The state budget leaves few other options.


  17. - Irish - Monday, Dec 9, 13 @ 12:31 pm:

    I think it will depend on the R elected Gov. I voted that they will reinstate it. I think only one will be clueless to the point that they will allow it to sunset and that would be Rauner.

    The others will reinstate it, all the while laying all the blame on the poor Dem management of state finances over the last decade and if it is Dillard or Brady they will also blame the public employees and their pensions. Unless Dillard moderates a little and gets public union support and then he will lay off the public employees.


  18. - Joe Bidenopolous - Monday, Dec 9, 13 @ 12:49 pm:

    I voted “other” since it is far from clear that the issue won’t be settled before then.


  19. - RNUG - Monday, Dec 9, 13 @ 1:05 pm:

    Voted other because it will depend on which current candidate is the sitting Gov.

    My guesses:

    Rauner would take a bulldozer to the State budget, cutting far, wide and deep.

    Brady and Dillard wouldjust use a sledge hammer, hope for revenue growth, and maybe add a few more sin taxes to try to close the gap.

    Rutherford would make more targeted cuts, even though his total could be the same as Brady and Dillard. And of the four, he would be the one mostly likely to push for new revenue, either via reinstatement of the income tax or a service tax or even a new tax structure.


  20. - Jerome Horwitz - Monday, Dec 9, 13 @ 1:34 pm:

    Sunset will devastate already suffering community based human services.


  21. - Grandson of Man - Monday, Dec 9, 13 @ 1:40 pm:

    I voted for sunset but should have voted for other. After thinking about it a little longer, “other” means sunset if Rauner is elected governor and possibly fully reinstating the tax if Rutherford is elected.

    “Delay payment of more bills”

    How fiscally responsible. The Trib knows a thing or two about delinquency in payments, given it’s bankruptcy issue.


  22. - Anonymous - Monday, Dec 9, 13 @ 2:12 pm:

    Can an “R” win in a blue state anyway?


  23. - walkinfool - Monday, Dec 9, 13 @ 2:13 pm:

    It will be retained at the current rates.

    It’s simple arithmetic.

    (a big assumption that our candidates will actually add and subtract)


  24. - Cassandra - Monday, Dec 9, 13 @ 2:18 pm:

    Well, I suppose a Repub governor would have the luxury of campaigning on letting the tax expire as planned (it’ll still be higher than it was) then once in office claiming things are such a mess that he has no recourse but to propose extending it for a while. Preckwinkle was not harmed politically by her phaseout of the sales tax increase, it seems, she is doing well politically. I do remember some criticism of not doing the phaseout all at once, and she handled it well.

    I voted for phaseout.

    Not sure what Quinn will do–last time we knew he would try to raise taxes if elected–could he try that one again. Depends on how scared he is of Rauner, I suppose. The others seem to be fading.


  25. - Oswego Willy - Monday, Dec 9, 13 @ 2:18 pm:

    ===Can an “R” win in a blue state anyway?===

    “Doubt it.

    Signed,

    Senator Mark Kirk
    Treasurer Dan Rutherford
    Comptroller Judy Baar Topinka”

    Dope!


  26. - Anyone Remember? - Monday, Dec 9, 13 @ 2:36 pm:

    “Other”

    The new pension legislation allows retirement systems (not employees or pensioners) to sue over missed contributions. IF the R (Rutherford excepted) can ensure that none of the boards will sue, they’ll let it expire. IF there is a chance of a suit, there will be some sort of extension, maybe Preckwinkle, maybe Edgar.


  27. - Statesman - Monday, Dec 9, 13 @ 2:49 pm:

    “Rutherford” and “Stones”: kind of like the ones he showed during the pension debate… Ya sure!


  28. - Robert the Bruce - Monday, Dec 9, 13 @ 2:55 pm:

    Other - a more modest tax cut somewhere in between the old rates and current rates combined, paid for with some more cuts on the backs of Medicaid recipients.


  29. - Anonymous - Monday, Dec 9, 13 @ 3:19 pm:

    Yes Oswego, but they are all social moderates. I suppose the real question should have been, can a social moderate win the “R” primary?


  30. - Ruby - Monday, Dec 9, 13 @ 3:23 pm:

    No matter who is governor we are never ever going back to a 3% flat IL state income tax.


  31. - Oswego Willy - Monday, Dec 9, 13 @ 3:28 pm:

    They are two very different questions, one being utterly Dopey to the fact of a “R” winning in a blue state, and your question, going for a specific race dynamic, having nothing to do with the entire Illinois electorate.

    Social Moderates have won primaries.

    Use your “Search” key, you might be suprised…


  32. - Ahoy! - Monday, Dec 9, 13 @ 3:34 pm:

    They will probably campaign for repeal and then propose to phase it out in time for the next election because they won’t want to own the cuts.


  33. - Ruby - Monday, Dec 9, 13 @ 3:35 pm:

    No matter who is governor we are never ever going back to a 3% flat IL state income tax.

    This is why:
    The governor does not decide the tax issue alone. The Democratic controlled IL General Assembly will not let the Illinois state income tax return to a 3% flat tax…too many bills to pay.


  34. - Rich Miller - Monday, Dec 9, 13 @ 3:37 pm:

    ===The governor does not decide the tax issue alone===

    The tax hike automatically sunsets. And I really doubt the Democrats can override a veto of a continuation of the full tax hike. So, in a way, he does decide it.


  35. - Ruby - Monday, Dec 9, 13 @ 3:46 pm:

    But I think the 5% IL state income tax sunsets after the 2014 election, so the General Assembly will still have some time to extend the tax before the end of 2014.


  36. - SAP - Monday, Dec 9, 13 @ 5:19 pm:

    The hike sunsets down to 3.75%, not 3%.


  37. - Juvenal - Monday, Dec 9, 13 @ 6:43 pm:

    No matter whom the governor is, they will support only a slight reduction in revenue, probably restructuring other parts of the tax code to roll back the personal income tax rate as much as possible.

    Any Republican who campaigns on a promise of rolling back the tax hike can expect the following:

    Madigan and Cullerton will not pass a lameduck extension, nor would Quinn sign it.

    The new gov will be forced to walk the plank and propose a doomsday budget.

    Madigan and Cullerton will leave that doomsday budget hanging out there for months, perhaps longer, while the new gov gets bludgeoned by everyone from the AARP to the zoological societies for the draconian cuts.

    The new gov will propose a new tax hike.


  38. - Soccertease - Monday, Dec 9, 13 @ 10:45 pm:

    Voted other. Believe MM will order the ISC judges to require that the income tax remain permanent to help pay for the pension theft bill aka SB1.


  39. - dupage dan - Tuesday, Dec 10, 13 @ 9:50 am:

    === - Anonymous - Monday, Dec 9, 13 @ 2:12 pm:

    Can an “R” win in a blue state anyway? ===

    Scott Walker, Wisconsin. He is NOT a moderate. Wisconsin is as blue as it gets (Madison and Milwaukee).

    Drive by comments do not a debate make.


Sorry, comments for this post are now closed.


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