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Question of the day

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* The setup

State senators advanced legislation Wednesday to allow Illinois voters to say whether the state should put a graduated income tax instead of the current flat tax. […]

Sen. Kwame Raoul (D-Chicago) called the flat tax—which is 3 percent for individuals—unfair and regressive. He maintained putting the measure before voters would allow debate on potential changes in the state tax strucuture.

To be adopted, the amendment would need approval by three-fifths of both the Senate and House by May 4 to give voters the chance to make the final decision in the November election.

The proposal only would allow lawmakers to put in place some form of graduated rate, or sliding scale, on the state income tax. It does not specify what the new rates would b

* More

Illinois currently has a flat tax. In fact, the state constitution requires it. The individual state income tax rate is 3 percent regardless of how much someone makes. The income tax businesses pay is a flat pay 4.8 percent, with an additional 2.5 percent replacement tax.

The state constitution also requires the corporate and individual income tax rates not to exceed a ratio of 8:5. That serves to forbid lawmakers from hiking business taxes too far.

But the constitutional amendment approved by the Senate Executive Committee would let voters choose if that system should be scrapped in favor of creating tax brackets with different rates. No specific income brackets or rates are included. If the plan were to be approved, lawmakers would then have to approve a new tax structure.

* The question: Setting aside your personal opinion of the proposal itself, do you think putting this question in front of voters is a good idea or not? Explain.

Again, let’s try to keep the debate over the specific policy proposal out of this as much as possible.

posted by Rich Miller
Thursday, Apr 17, 08 @ 10:15 am

Comments

  1. Good idea? No. If it gets on the ballot, it will surely pass as we like to stick it to someone else (in this case ‘rich’ people). Then it will go back to the GA and get bogged down again as anything useful does.
    This is just another example of what is wrong with the constitution, and why we need a Con-Con!

    Comment by Trapped In The Metro East Thursday, Apr 17, 08 @ 10:20 am

  2. Bad idea. It would be like Pat Quin as governor! Let the 10million people making $50,000 and under per year vote to tax the 3million people making above that amount an increased amount.

    Comment by Wumpus Thursday, Apr 17, 08 @ 10:22 am

  3. Bad idea. How do you properly phrase the question so that every voter understands the issue without the question encouraging one side or the other. This is the type of issue that needs to be considered at the CON-CON, as well as the recall, school funding, property taxes, combinig the comptroller’s and treasurer’s office, etc.

    Comment by clj Thursday, Apr 17, 08 @ 10:26 am

  4. I think its about time lets get Illinois tax structure fixed

    Comment by independent Thursday, Apr 17, 08 @ 10:28 am

  5. Dopey idea….why have a referendum without proposing an increase and tax relief….House had a much better plan. Too bad Senate did not figure that out.

    Comment by Wild Bill Thursday, Apr 17, 08 @ 10:35 am

  6. If we could vote on created a progressive tax system, then we should also vote on the abolishment of individual income taxes.

    Comment by Levois Thursday, Apr 17, 08 @ 10:36 am

  7. This affirms the need for a con-con.

    No amount of money will fill the hole of needs as defined by our governing bodies.

    Voters can be sold a bill of goods, especially when the media is asleep.

    I’ll bet that voters are not as stupid as politicians think. Most hope that someday they will be ‘rich’

    Comment by plutocrat03 Thursday, Apr 17, 08 @ 10:41 am

  8. It will help Republican turnout, as well as downstate.

    Good idea, but, WHAT were they thinking? :)

    Comment by Pat collins Thursday, Apr 17, 08 @ 10:47 am

  9. Bad idea, there will be a Pavlovian-dog response by the voters thinking this will solve all the state’s fiscal woes. And as stated above, then you are trusting the dysfunctional General Assembly (See Rich’s entry on the Exec Cmte’s childlike behavior yesterday) to enact something fair if passes. No can do!

    Comment by Fire Ron Guenther Thursday, Apr 17, 08 @ 10:53 am

  10. It is a back door way of Blago raising taxes. That is why Emil is doing it in the Senate, not the house. This way he does not have to concede he raised taxes, he will let the people do it themselves.

    The 5 surrounding states are laughing all the way to the bank. The businesses we did not run out by the democrats anti business approach will now have to migate to other states. We have already hit business owners at the office, now we are going to try and hit the good ones at home.

    Fool me once?

    If you vote for any democrat in this state you deserve to have higher taxes and lose your job. Oh yea, when you work in IL, and your job goes to Kentucky, that is not President Bush’s fault!

    Comment by the Patriot Thursday, Apr 17, 08 @ 10:56 am

  11. Spins like a fair 7 equitable way to tax but it opens the door to the millions of IL residents not paying taxes to raise the rates on those of us who carry the burden.
    IF IF IF we could trust our elected leaders to not screw us with jacked-up rates, we might go for it BUT it is really just a way to whack us, driving us across the borders.

    Said it before elsewhere, will continue saying it… look at Michigan. IL is following MI’s model of how to drive citizens and businesses out of the state while blaming everyone else.

    Comment by North of I-80 Thursday, Apr 17, 08 @ 11:07 am

  12. All the amendment does is to get rid of the constitutional requirement that we use a non-graduated rate. It’s a dumb provision of our constitution, and if the people think a flat tax makes sense in the future, then getting rid of this provision in our constitution won’t stop us from using a flat tax.

    We are restricting our ability to come up with the best tax system for the times — whatever that tax system may be — with the non-graduated rate provision of the constitution.

    This is a very narrow, very targeted proposal that I hope is embraced by legislators from both parties.

    Comment by Dan Johnson-Weinberger Thursday, Apr 17, 08 @ 11:11 am

  13. Am I understanding the argument for not putting it in front of voters is that they would have the gall to vote yes?

    Someone tell me that I’m wrong, because it sounds like most people think its a bad idea because if put in front of voters, they would want to change the system… isn’t that kind of saying that it’s a bad idea because then democracy might work?

    Comment by Chicago Law Student Thursday, Apr 17, 08 @ 11:14 am

  14. The anti-tax cult has so much of the talk radio crowd brainwashed that rational public discussion of tax policy is impossible. You’ll see millions of middle class voters line up to vote against it but the same people will say nothing when someone proposes a regressive sales tax. They’re too easily manipulated by the Chamber of Commerce Crowd.

    Comment by Sango Dem Thursday, Apr 17, 08 @ 11:15 am

  15. we are too factionalized for a Con-Con to succeed - better to amend the current State Constitution, as we have done on numerous occasions.

    Forget Blago - if the amendment passes in November, the General Assembly will have to pass laws to implement a new structure in 2009, and the first tax year impacted will be 2010 (FY 2011)as Blago heads out the door.

    Yes, amending the Constitution in this manner is appropriate. It isn’t a populist tactic, because the legislature cannot address the issue without a Constitutional amendment.

    Comment by Capitol View Thursday, Apr 17, 08 @ 11:16 am

  16. Exactly how is it better to let the **GENERALY ASSEMBLY** amend the constitution as they see fit, then elected 118 new people to come up with an overall long-term vision?

    Do we really want to completely relinquish the keys of the kingdom to the ILGA?

    Comment by John Bambenek Thursday, Apr 17, 08 @ 11:33 am

  17. And to be clear, even if the General Assembly approves this amendment by May 4, and then the people approve this amendment to the Constitution…nothing changes.

    Nothing.

    The flat tax remains in place.

    It is just no longer a constitutional requirement that we use a non-graduated rate.

    If the General Assembly decides that a graduated (or progressive) income tax rate makes sense in 2009 and they can come to agreement with the Governor, then there is the possibility of a graduated income tax rate.

    But there is not any requirement to do so.

    Again: nothing changes with this amendment. It just eliminates a constitutional requirement that we use a non-graduated rate. We can continue to use a non-graduated income tax rate for the next 100 years even if this amendment passes. It’s up to us.

    Comment by Dan Johnson-Weinberger Thursday, Apr 17, 08 @ 11:35 am

  18. Rich,

    I can see the logic of both sides of the argument…

    Pro: While it might not — MIGHT not — be a good idea to have a referendum on tax rates in this state, I think it would be a good idea to allow the people to decide if their state must be forbidden from adopting a graduated tax structure.

    Con: Taxation is far too important to leave to mere voters. Such matters should be reserved to bodies that can be more effectively influenced by monied interests and their lobbyists. If voters want a “voice”, they can always watch American Idol.

    – SCAM
    so-called “Austin Mayor”
    http://austinmayor.blogspot.com

    Comment by so-called "Austin Mayor" Thursday, Apr 17, 08 @ 11:36 am

  19. Bad idea. Keep in mind the general idea behind a constitution is to put in place a system which protects those in the minority from the whims of the majority. Leave it to voters and the majority will always seek to take or limit those groups which are smaller.

    Thus we have things like equal protection under the law etc. I am not opposed to graduated tax, nor do I think it would unconstitutional (if the consitution is ammended), but the decisions is to be made by law makers not the masses, taking into consideration the rights of those effected and the law. Our grovernment is not a “democracy” for this very reason. Democracy in its full form is mob rule. The general Assembly are being cowards.

    Comment by Ghost Thursday, Apr 17, 08 @ 11:42 am

  20. ===the decisions is to be made by law makers not the masses,===

    Um, no. The only way to impose a progressive tax structure is to change the Constitution and the GA can’t do that on its own.

    So your “cowards” comment was way out of line.

    Comment by Rich Miller Thursday, Apr 17, 08 @ 11:45 am

  21. Yes. It’s the only way the Constitution can be amended, right? Lots of hoops to jump through even if passed before anyone’s taxes go up.

    Comment by wordslinger Thursday, Apr 17, 08 @ 11:59 am

  22. Different issues have different majorities, some issues don’t even have majorities. There will always be tension among groups on social/economic/political ideas and actions. Some might say the current, and overwhelmingly, Democratic majority of elected state officials is “mob rule.” we can see how well they “rule.” Why not let the rest of us vote on how much money we give “our” government? Of course, that means coke-head businessmen, high school dropouts as well as responsible journalists, soccer moms, mechanics, and school teachers will all have a say if they choose to say it. So why not let them say it?

    Comment by anon Thursday, Apr 17, 08 @ 12:01 pm

  23. It’s OK to have the people vote on a proposed constitutional amendment, AAMOF it’s the law. I’d be much less impressed by an “advisory referendum” or some other relatively useless action on this question. Let’s see if the GA can even get to the 3/5′ths agreement that this is a good idea. If they can, let’s see how the pro and con factions sell their side to the public prior to the popular vote referendum. And then, when & if such an amendment is passed, let’s see how the GA proposes to implement it in a way that is fair and keeps people and jobs in IL.

    Comment by Six Degrees of Separation Thursday, Apr 17, 08 @ 12:05 pm

  24. Put it on the ballot!
    This is a serious question of tax policy in the state, and I have the audacious hope that we can use the presence of such a ballot measure as the context for a serious debate about the long-term issues of funding government in Illinois.

    Comment by erstwhilesteve Thursday, Apr 17, 08 @ 12:43 pm

  25. Why not. Maybe “the masses” have a better understanding of tax policy than Sen. Raoul, who seems to think that our current tax system, which requires those with more income to pay more in taxes is somehow “regressive.”

    Comment by grand old partisan Thursday, Apr 17, 08 @ 12:47 pm

  26. Why are so many people afraid of democracy?
    Put it on the ballot and make you case in favor or in opposition to it. Voters are not stupid.

    What are you afraid of?

    Comment by VanillaMan Thursday, Apr 17, 08 @ 2:13 pm

  27. The fear isn’t of democracy working and the people attaining what they rightly want, the fear should be “Illinois democracy” hijacking the system and changing the constitution through smoke and mirrors. I feel more comfortable with a Con-Con, because their is a better chance for real representation of the people than what we have with our current government. Of course, I could be completely wrong on that.

    Comment by clj Thursday, Apr 17, 08 @ 2:55 pm

  28. Funny how you can engage in objectively analyzing hypothetical situation in lieu of actual policy options for something that isn’t the Children’s Museum Grant Park fiasco =)

    I don’t think there’s anything inherently wrong with putting the question to a referendum; however I agree with those previous commenters in the importance of how the ballot question is worded. If it can’t be worded in a neutral manner, then it’s probably a bad idea since the conclusion would be nearly foregone.

    Comment by VivaLFuego Thursday, Apr 17, 08 @ 2:59 pm

  29. As many above have pointed out, this issue alone proves the case of “Yes” on a convention, and probably a “no” on this initiative.

    My bet is that it’s passage is less likely than people think, as the limp business community might actually pony up some funds to fight it. With this government, it is the one thing that might awaken the “center-right” part of electorate. (Lord knows the so-called Republicans aren’t offering them anything to vote for).

    For my part, anything remotely close to this policy needs to be tied to ironclad, permanent, and substantial property tax reductions. No steep property tax cuts, no “progressive” income tax.

    Conversely, a big hike in the tax, combined with large deductions, accomplishes the same goal with out a convention or an amendment. DJW has pointed this out often enough.
    __________

    This topic alone exposes the IBRTs and the Illinois Chamber’s position on the ConCon as downright dumb. They supposedly seek to “preserve” the flat tax (the only thing in the Const. worth “preserving” - from a business perspective), and here in Illinois, the mere operation of time, pensions, and spending will force the breaking of that clause under any circumstance.

    Rather than fight for transparency, Constitutional spending restraint, a real (not fake) balanced budget clause, end to gerrymandering, and the numerous things that the IBRT’s and Chamber’s constitutency !!! PAY THEM DUES TO LOBBY FOR !!!!, the well-fed bureaucrats in the business “Lobby” fight against the single opportunity for real change - a CONVENTION!

    Every dues paying member of the “business lobby” ought to consider canceling their membership, and funding an aggressive campaign to pass a Con Con.

    What ever one’s position on the flat tax, it should be obvious to everyone except people who lunch regularly at the Sangamo club that having a convention is the only chance they will ever have to keep it.

    DOH!

    Comment by Bruno Thursday, Apr 17, 08 @ 3:11 pm

  30. I think it makes more sense to amend the current Constitution than to call a con con and roll the dice that they come up with something better. I see no reason why the taxation methodology even needs to be in the Constitution, it strikes me that is an implementation detail, not a legal issue. It is not in the Federal Constitution–just an amendment allowing for the FIT, not specifications about how it will be implemented.

    Comment by cermak_rd Thursday, Apr 17, 08 @ 3:44 pm

  31. It is way too early in the process to submit it to the voters. However it is past time for a complete review of the taxing fabric/systems in Illinois. A hopefully knowledgeable and bipartisan group of professionals, with assistance from public financing specialists, should be charged with developing two or three proposals for submission to the voters. Property, sales, income, taxes and even the multitude of fees should all be reconsidered and a modern more fair and efficient system evolved. It should also include a provision for being revisited and modified periodically e.g. every ten or fifteen years. Yes it should go to the voters but only after a complete review and recasting of well thought out alternatives.

    Comment by A Citizen Thursday, Apr 17, 08 @ 3:57 pm

  32. cermack,

    There is no rolling the dice because there is no chance of anything worse. I understand the reverence people have for a the word “Constitution.”

    This one deserves no respect, no matter how nice some of the drafters might have been. The spectacle of the recall debate is NOT an accident. That show, and the advent of G. Ryan and Blago are the direct result of this constitution. They are inseparable.

    Your point about whether such taxation clauses even belong in the Const. is a good one, but that is what conventions are for.

    You should vote “Yes” and run as a delegate. You are clearly more qualified than any of our current legislators to think things through.

    Citizen,

    I agree with your sentiment, but not your process. We don’t need ‘experts’ and “public financing specialists.”

    We need 118 citizens hashing these things out in a room after campaigning on their ideas. It is the “experts” that got us here.

    My proposition is that we put in a balanced budget clause eliminating ALL “debt as revenue.” This will solve 80% of the problem.

    Next, 100% transparency (put everything each Gov. agency does IN FRONT of a Foia request, uniform fashion, and on-line with in 48 hours.

    Last, leave tax mix alone, but cap the growth of every agency (State to Mosquito abatement district) to inflation + population growth. Allow residents to break cap with a 55 or 60% vote.

    Run on it. Implement it. Leave the policy wonk professors at home. They’ve had their day. They blew it.

    Comment by Bruno Thursday, Apr 17, 08 @ 5:33 pm

  33. Want a graduated income tax? Just raise the standard deduction a few thousand dollars. Add a separate personal exemption that deducts a few more thousand, just like the IRS.

    Since both approaches should be much easier than amending the Constitution, this must be a dog and pony show to help promote con-con so the Democrats can finally write the Constitution the way they want it.

    Comment by Anonymous Friday, Apr 18, 08 @ 8:22 am

  34. Anon,

    Your first point is a good one, but all this stuff about “democrats” writing the new Const. is unproven, and conceding defeat before even trying.

    First, the “Democrats,”

    [which really describes a “political class” more than the many decent democrat citizens across Illinois]

    already control everything (including the Republican party apparatus and ideology). They do what they want anyway. Anything they could write into a constitution, they will eventually pass out of the increasingly unassailable legislature.

    We can fight for a shot at a cleaner constitution, or we can watch as everything worth “preserving” is taken anyway.

    You can’t win if you don’t fight, as the flaccid Republican party proves with every passing moment.

    Comment by Bruno Friday, Apr 18, 08 @ 11:37 am

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