When the Institute on Taxation and Economic Policy looked at every state with an income tax, guess who they said was the most unfair?
That’s right. It’s Illinois.
It’s time for that to change. As governor, I’ll fight to pass a progressive income tax. It will make the wealthy pay more, provide support for priorities like education and reduce the tax burden on middle class families.
Let’s make our tax system fair and bring real change to Illinois.
*** UPDATE 1 *** There’s a problem with Pritzker’s analysis.
If you look at ITEP’s Illinois analysis [click here], you’ll see that the share of family income going to the state’s personal income tax is actually quite a bit less for the lowest 20 percent of earners than it is for the highest earners. That’s likely because of the Earned Income Tax Credit.
The real culprits are sales and property taxes. The bottom 20 percent pay 7.1 percent of their family income to the sales tax, compared to 0.8 percent for the top 1 percent. And the bottom 20 percent spend 4.9 percent of household income on property taxes, compared to 1.8 percent for the top 1 percent.
So, while he’s right that our tax system is unfair, his solution won’t do anything about the really regressive taxes.
The study, Who Pays?, provides insight into the drivers behind the unfairness encoded into Illinois’ existing tax system. Illinois relies heavily on taxes that are not based on ability to pay, but rather on a flat rate. Further, unlike most other states, Illinois does not have an income tax where taxpayers with higher incomes pay a higher rate and taxpayers with lower incomes pay a lower rate. As a result, the income tax doesn’t bring more balance to the overall tax system by offsetting the higher share of income that poorer taxpayers pay in sales and property taxes.
One positive aspect of Illinois’ tax system is the state’s Earned Income Tax Credit, which lets low- and moderate-income working families keep more of their earnings to help pay for things that help them keep working, such as child care and transportation. To improve tax fairness in Illinois, lawmakers should increase the value of the state’s Earned Income Tax Credit.
*** UPDATE 2 *** From the ILGOP…
J.B. Pritzker supported the income tax hike without reform, engineered a property tax scam that saved him over $230,000, and is partnering with Mike Madigan, who profits from Illinois’ broken property tax system. Pritzker pretending to care about fair taxes is just his latest scam.
If he has to change the Illinois constitution to do this should state employees be worried that at the same time it could remove their pension protections?
- lake county democrat - Tuesday, Sep 26, 17 @ 2:29 pm:
Wow. It’s a great idea. And no, it doesn’t *have* to mean raising taxes - arguably it could be revenue neutral - but since taxes do indeed need to be raised if we ever hope to really build the state and reverse it’s decline - this is by far the best way to do it.
Missed opportunity in the ad though: he could have pointed out his plan would hurt people like himself and Rauner but that’s ok - we’ll be fine - it’s you who is being hurt by the current system.
Of course, it’s a tax hike … duh. It’s what Democrats do.
And JB could walk-the-talk by 1) Voluntarily paying more at some progressive rate, and 2) Paying his fair share of real estate taxes.
This guy is a real piece of work. It’s almost as if some Democrats want a Pritzker v Rauner matchup; giving Rauner his only chance at re-election.
- Grandson of Man - Tuesday, Sep 26, 17 @ 2:39 pm:
Perfect. Short and to the point. I rate it an A.
Tax fairness is a critical issue and should hopefully campaign well. It’s a perfect contrast to Rauner’s reforms, which would strip the protections and lower the wages and benefits of millions in the working class, over time.
Next time, use a study that’s 1) Current and 2) Takes into account the total tax burden. Progressive tax in Illinois will be a classic bait and switch. Just need to look at neighboring states to see the creep, creep, creep down the income tax bracket of those ’soak the rich’ rates …
Yes, we should all be happy because once we get back to having a Dem in the governors chair we can finally focus on taking more money from everyone to pay for state government, income tax, gas tax, property tax, maybe even the sugar tax. And for this increased transfer of wealth we’ll have a much more efficient and effective state government. J.B. promises it. Be careful what you wish for Dems , it just might come back to bite you.
To the update, if you had graduated income tax rates, you wouldn’t need to overrely on sales and property taxes. You could raise revenue from rich folks’s fat incomes and cut sales/property taxes for the rest.
B+ Message straightforward, and very clear to likely primary voters. My problem is with the up close and personal approach. Some issues require a little more serious and concerned tone, rather than the nice guy from next door persona.
Overall JB is hitting the right buttons with his ads.
It is a very good ad, clear and to the point. Remember the audience, it should not be too specific. And it smartly does not point to a Constitutional Amendment, which will be difficult. Smart policy expertys know there are ways to introduce much more fairness under the current limitations.
Sorry, Ron, the pensions must be paid. And, Illinois is nowhere near the bankrupt status of Detroit, even if law allowed states to go bankrupt. There are many successful states with graduated state income taxes, from right-wing Iowa next door (top rate near 9%) to left-wing California (top rate 12.3%). And, I think we can change the IL Constitution to allow a graduated income tax without fear of changing the pension protection language since we just changed the Constitution to protect Road Funds without impacting the pension language.
How does a graduated state income tax have an impact on how counties and municipalities levy property taxes?
Unless you also start using those income tax funds to increase state funding for education and allowing school districts to rely less on local property taxes.
===And it smartly does not point to a Constitutional Amendment, which will be difficult.===
… because you want Pritzker to look foolish that this isn’t going to be as easy as it seems?
===Smart policy expertys know there are ways to introduce much more fairness under the current limitations.===
What are those?
‘Cause, right now, that pesky constitution is the whole ball of whacks, and if there is something in an income tax fix that doesn’t need that constitution fix, you should enlighten us, many smart policy people are waiting I’m guessing, lol
@ Deft Wing - “Voluntarily paying more at some progressive rate” Not really, at least not as simply as you seem to imply. He could have his accountants not take all the deductions he is allowed, and pay more that way, but I don’t think the State can just accept a check for no reason.
===To the update, if you had graduated income tax rates, you wouldn’t need to overrely on sales and property taxes. You could raise revenue from rich folks’s fat incomes and cut sales/property taxes for the rest.===
Do you honestly think that the sales and property taxes would go down? If you believe that, I’ve got a bridge I want to sell you…
From a purely political standpoint it’s a smart ad and a smart move to very publicly support a progressive income tax before his opponents can own the issue. A billionaire wants to raise taxes on himself? Boom.
What happened to equal treatment? When I worked for the State, I was subject to rules and regulations that did not apply to the private sector, had to pass both IBI and FBI background checks due to the sensitive information I had access to, was paid much less than I could have earned in the private sector, had my salary disclosed (something the private sector strictly guards), had to surrender some of my political free speech rights due to Federal funding rules, etc.
The only thing that had kept this State running are people who believe in public service in spite of the restrictions.
I would rate it a D. Anytime a politician is talking taxes, the public isn’t buying it. Why is this necessary? If he wants to talk about taxes, why doesn’t he simply state, I want the rich to pay more. If I’m half paying attention to my TV, this isn’t something that would endear me to him.
I give it B. It was a little vague on the details but then again, it’s an introductory ad regarding the issue. Plus, it should appeal to people who think it’s only fair that the rich pay more taxes while the middle class pays less.
=admits he’s going to tax retirement income=
When did he say that?
OW - JB said he wanted a progressive income tax. His study cites all other states with progressive income tax, all of which tax retirement income. He specifically cites that the wealthy pay more, and considering the quickly retiring Boomers are the wealthiest generation, he’s obviously targeting the folks with money. And generally speaking, progressive taxation is built on ability to pay, no age or employment status.
It would be great if it would reduce local real estate taxes. Of course that will never happen. During periods of time when school districts were receiving 7% increases in state funding and big bumps in the new constructions levy they still levied the max. All that happened was an increase in salary and benefits for the NEA along with the abusive 20% end of career bumps. Without a freeze at the state level you will just get higher taxes. One overlooked reality for those above the amt limits is that real estate tax deductions at the federal level disappear which would make it federally progressive.
OW - The thing is, JB doesn’t have to change the constitution to implement a progressive income tax. He could simply play with the EITC levels or personal tax exemptions and raise the overall flat tax rate to compensate. It would have a similar effect.
===JB doesn’t have to change the constitution to implement a progressive income tax. He could simply play with the EITC levels or personal tax exemptions and raise the overall flat tax rate to compensate===
JB has the typical response to Illinois problems- just give me more revenue. And when Amazon passes on Illinois- it will be one more factoid in the conclusion that we are is dire need of improving the business climate.
City Zen I don’t agree, the Constitution is very clear: “A tax on or measured by income shall be at a non-graduated rate. At any one time there may be no more than one such tax imposed by the State for State purposes on individuals and one such tax so imposed on corporations.”
This is why the campaign for a fair tax which failed was all about a constitutional amendment. See http://www.citizenaction-il.org/fair-taxes-and-economic-justice The Senate passed the constitutional amendment bill in the spring of 2016 allowing for a graduated income tax to be placed on the fall ballot. Speaker Madigan and his leading Democrats didn’t call it for a vote in the House. Not even a vote.
There is no reason to believe JB will do much better, but lets wait and see.
CZ, most State pension system members receiving the AAI (TRS and SURS) pay 1.0% as an AAI contribution. SERS members, less than 25% of the total, pay 0.5% because their pension multiplier is lower and because they receive Social Security.