As JB has said since he decided to run, Illinois’ tax system is unfair and needs to change. JB believes people like him and Bruce Rauner should pay more to help solve the state’s budget problems and fund education while lowering the tax burden on the middle class and those striving to get there. The large majority of states in America have fair tax systems in place and there are many ways to institute one here in Illinois without asking middle class families to pay more.
Bruce Rauner’s a failure. So, instead of talking about his own record, he distorts mine. When it comes to taxes, Illinois has the most unfair income. tax system in America and. It’s time for that to change.
A fair income tax will raise taxes on people like Bruce Rauner and me to support education and help solve the state’s budget problem while reducing the burden on the middle class. Don’t believe Bruce Rauner’s attacks. Let’s make our tax system fair and bring real change to Illinois.
…Adding… Rauner campaign…
What’s unfair is that JB Pritzker is a tax cheat pushing tax hikes. Pritzker hides his money in the Bahamas to avoid paying income taxes and has ripped toilets out of his mansion to dodge property taxes. It’s unfair to hardworking taxpayers that JB Pritzker plans to raise taxes while dodging his own.
*** UPDATE 1 *** Pritzker’s ad references a study by the Institute on Taxation and Economic Policy. He did the same sort of thing last year and we took a look at it…
* 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 Rep. Martwick…
Recently, my progressive tax proposal has been the subject of discussion on the blog. In defense of JB Pritzker, I’d like to offer the following: First, my bill was developed in late 2016 and filed in early 2017, long before JB announced his run. My bill was conceived during the height of the budget impasse as I couldn’t believe that we were limping along accumulating $6 billion of debt per year while literally killing people who were denied critical social services. There was not a single proposal to fix any of problems, except for the much panned and silly IPI proposal. Everyone knows that we would have to amend the constitution in order to adopt progressive rates and as such, I had no delusions that my bill was going anywhere. What it was designed to do was begin a discussion about how we could possibly solve our problems by changing the structure of how we raise and spend money. I specifically chose the Wisconsin tax structure because it is the flattest and most predictable of the progressive rates structures, and it is from the state that we are often told to be more like. I used the revenue to fund education, pay down our pension debt, create the biggest property tax decrease in the history of the state, lower property tax rates, and re-invest in higher education and infrastructure. This addressed nearly every major problem we have in Illinois (even our business climate, as lowering property taxes is the single most effective way to improve the bottom line of every single business in our state). My proposal was based on math, the realities of our condition and it addressed problems. In other words, it worked. Does that mean it was the best solution? Not at all. We can debate about that. But it was A solution and it was offered when no one else, especially the Governor, could be bothered with such a task. The Governor and the Republicans demanded to see a rate structure and as soon as one was provided immediately criticized it, and of course they only ever talked about the income tax increase, without ever mentioning the record property tax and sales tax reductions. Now they want to tie my proposal to JB and that is nothing short of deceptive. Yes, the rates matter, but those can be and should be determined by the legislature. Clearly, JB wants to accomplish the same things I tried to accomplish and every single Illinoisan should want: restoring financial security by paying down our debts, and lower property taxes through more equitable school funding. That can be done by an infinite combination of rate structures, including ones that lowers the overall tax burden on the middle class while requiring those who have been so successful to pay a fair burden. I’m happy to have that discussion on what exactly the best rate structure is, but I can only do that with a Governor who is open to a progressive tax so that we can fix our problems and reform the 5th most regressive tax state in the country. JB is ready to have that discussion. Rauner is not.
Showed someone who was not in politics and they gave it a B. They thought it was straight forward and liked how he mentions he would be raising taxes on people like himself & Rauner so people like them need to pay less.
Another home run. GovJunk Exit Interview Tour continues. He wrecks GOPie AG hopes with dopey claims and the $1 million rental payment. Wonder how quick she renounces the paytment to reestablish some integrity.
Great ad. I give it an A. Many democrats have expressed concern around JB’s messaging on the progressive income tax proposal. They have suggested that by not being crystal clear on who would and would not be impact by higher rates allowed Rauner to dominate the narrative. This ad makes it very clear. I would recommend putting a lot of points behind this one.
The issue I have with this is twofold. First, JBP seems to refuse to share his vision of what the scale is - what are the graduated tiers? And second, perhaps much more important, the vision government still has is that middle class is a family of two making a household income of gross $120k. Not to start a Chicago vs the rest of the state issue - but where the mass population live in Chicago, that’s far from middle class. When 1 bed apartments rent for upwards of $1500 are typical, city/county/state sales taxes ridiculous, that $120k goes fast. I bet most would agree, including the wealthy, that they should pay more, but that purported middle class ends up carrying the mass load since they are the majority of the tax payers. In fact, most wealthy earners are mainly concerned with the total amount they bring in per year as a badge of honor (was just on NPR Freakanomics) and would mostly gladly pay more.
As I’ve said many times I can’t rate these things, but I also can’t help but laugh at how many buzz phrases he got in there. “Rauner’s a failure” “raise taxes on guys like Rauner and me” “bring real change”.
“The issue I have with this is twofold. First, JBP seems to refuse to share his vision of what the scale is - what are the graduated tiers? And second, perhaps much more important, the vision government still has is that middle class is a family of two making a household income of gross $120k.”
And by default, does that mean for single 1-person household (of which I am one), that the government defines “middle class” as $60K?
- Grandson of Man - Friday, Aug 10, 18 @ 10:13 am:
While I’m not sure we have the most unfair tax system in America, it’s great to do the ad on a progressive income tax and get it out there.
It’s great Pritzker said it’s time to raise taxes on himself and Rauner. It’s true. It is time to raise taxes on Pritzker and Rauner. The hike would not be much for multimillionaires and billionaires. The Rauner plan is to gouge the money out of unionized workers through taking away rights and harsh cuts.
I like Pritzker’s prominence in the ad, his voice. I love him starting the ad with Bruce Rauner is a failure. Not necessarily crazy about a possible lie on the most unfair tax system in America. But I’m very happy Pritzker is bringing the issue into the campaign.
I’d be more convinced JB was sincere if he said those things on the Blago tapes when he thought no one was listening.
There is a point to be made about the off shore accounts and propterty tax appeals.
This may well be a fast response to the Rauner ad about taxes profiled here yesterday. Fine. I can’t see that JB’s ad moves his ball forward in any way, however. The people (voters) who want to know more about the hows and levels of JB’s fair taxation proposals, and how they might realistically be accomplished, and how those proposals might affect them personally, are still in the dark after seeing this ad.
I for one am tired of hearing about the toilets being removed to lower the property taxes on the mansion adjacent to JB’s. Not that I am defending the man but I highly suspect that he pays far more in property taxes to keep the uninhabited mansion in place and maintaining the historic integrity of the neighborhood than if he had torn it down and out in a lawn. As far as Bruce goes, I seem to recall he got caught claiming his primary residence and one of his downtown condos both as his primary residences for property tax purposes not that many years ago.
When you’re explaining, you’re losing. People don’t trust politicians. Rauner says JB is trying to hike taxes on the middle class. JB says Rauner is lying.
But Rauner had already defined JB as a corrupt tax cheat political insider in Madigans pocket. When he won’t releSe rates, why would anyone trust him?
The truth is there’s no way to both raise significant revenue and cut middle income taxes. CTBA tried and the best they could come up with was $2B a year and a $300 a year cut for people making less than $100k. That was using static scoring and it still kept the state in deficit spending over the short term.
Pritzker wants you to think his progressive tax can pay for a bunch of new spending while fixing our current structural gap and that he’s going to do all that while giving a cut to the largest portion of the revenue bell curve.
The only reason its a D is the production value is good.
He says he is going to raise taxes, doesn’t say the rates, and just wants it to be fair. No matter the taxpayer’s income, they will automatically assume that they’re rates are going to go up, and they’ll get the short end of the stick.
The incompetent failings of first the toilets, then completely refusing to hang the 32% tax increase Rauner certified allows an ad like this to seem less.
It’s one thing to say Rauner failed.
It’s quite the other to give no quarter, no space on issues and keeping pressure on so blowback can’t seem… rational.
The ad is a “C+”, at best.
You want your own taxes to go up, you want the middle class to get “whatever”, the reality is this type of ad allows others to drive trucks thru the holes the Pritzker Crew seemingly want either ignored or dismissed.
I haven’t even going into the lacking of specifics of rates or bridges, or even the legislative hurdles to even discuss this becoming remotely real.
You can’t run a policy ad that lacks the specifics of the policy and have the history of letting your opponent own you on the issue.
Rauner signed a budget which requires a 32% tax increase and its treated as a throwaway fact.
It’s a pillar reason Rauner failed.
Rauner raised taxes, had no reforms, hurt social services and higher education, and couldn’t cut a budget to serve the state’s better. Rauner is a tax and spend failure with higher taxes and lower services to Illinois.
Rauner seemingly owns taxes. That happened well before today. Now we’re seeing that come back to haunt.
Middle Class and poor people get the burned by these taxes. In addition to property taxes the tax system is dependent on them when you look at lotto, cigarettes, tolls, and sales taxes which all disproportionately effect them.
Just compare the rate a politically connect person pays in their TIF ivory tower vs a person in Harvey.
==The people (voters) who want to know more about the hows and levels of JB’s fair taxation proposals, and how they might realistically be accomplished, and how those proposals might affect them personally==
…aren’t up for grabs in this election. They know how they’re voting.
Voters want to hear about values, not numbers. Or, as Rich puts it, “Voters don’t do nuance”.
Good spot. More of this please. I think the difference in strategy between the campaign and the Monday morning QB’s here is data. They’ve surely tested the hell out of this message and strategy. They clearly must have data that shows they can win on this issue without providing the details that many on here want.
Please remember that median household income was $59K in the US in 2016. That is truly “middle class” in this country. Those making $120k are doing very well in comparison, even if they don’t live as high on the hog in Chicago as in other parts of the state. $59K in Chicago would be tough and barely middle class to me, but many folks get by with less.
At a time of rising economic inequality and downward mobility for formerly middleclass residents, this issue of making the richest pay their fair share resonates. Rauner opposes even a millionaires tax, so bringing up the middleclass is just a diversion.
The 90th percentile of nationwide household income was around $160k in 2014 I argue those folks should be included in a tax increase, not just the 1%, which starts somewhere around $460k, still far short of “millionaires.”
CZ…you may be right that JB is not being totally forthright by not giving tax rates and brackets. I prefer honesty in all things, but when dealing with a serial liar, it may be acceptable to give broad outlines, especially when negotiation with the legislature is needed before anything can become law.
At what percentile do you think middle class ends? 66%? 80%? That income level will be surprisingly low to some on this blog, as hinted by my numbers above. Some folks don’t know when they’ve got it good. But don’t worry, empathy can be learned, I hear.
JB totally misses the boat on the unfair property tax system that is written to benefit political insiders who run lucrative property tax appeal business.
People are leaving the state because they can’t afford to pay rising property taxes that have no relation to income.
He says he wants a plan where people like him and Governor Rauner pay more in taxes but his actions tell us he goes to extraordinary means to avoid paying taxes through property tax loopholes and off shore accounts.
Jibba - JB could easily say “If you make less than “x”, I promise you will not pay more in state income taxes while I am in office.” That covers whatever tax plan he plans to implement as he should have good estimates on how much his plans will cost (and save). Those above that threshold, or those who think that threshold will eventually impact them, can plan accordingly.
As for where the middle class ends, you’re right that income level will be surprisingly low: 55% of state tax filers claimed less than $50K income and 70% makes less than $75,000. If you think households with $120K have it good, you can visit suburbia and explain it to them.
$120K sounds like a lot. I work with people making less than that that
==because they can’t afford to pay rising property taxes…==
And therein lies the rub. No matter how “fair” JB claims he wants to make the income tax system, it does nothing to alleviate the extreme burden of property taxes across all income levels.
A millionaire paying a few extra percentage points in state income taxes than you is all peachy until you realize you’re still paying the highest property tax rates in the nation. You’re still scraping by. You’re still having a hard time finding buyers for your house. And no one has offered a fix for that.
CZ…maybe he should, given the mileage that Rauner has gotten over the issue, but Rauner would probably just call him a liar. I suspect he has not done so because he thinks he doesn’t need to in order to win, and he may be right.
Hopefully, he has gotten projections for revenue raised given differing levels of taxation. Not having done so would indicate perfidy or a lack of seriousness about the issue.
Not saying that $120K means champagne and caviar everywhere in Illinois, but you could have a decent life just about anywhere on that scratch. Maybe not private school, maybe not Kenilworth, maybe not two cars plus an annual vacation to Europe, but safe and happy. And almost 80% of Illinoisans would be trading up if they received that income.
The middle class in the state is dying. High income and property taxes are one of the causes. JB should be talking about how he is going to pay down our debt. Instead he talks about spending and raising taxes. You can not pay down all our debt and increase spending, by just taxing the rich more. The middle class will pay higher taxes and many will leave the state, if he becomes governor.
Anonymous 2:39, you make CZ’s case that JB should release specific figures. As we’ve just said, middle class in Illinois sunsets at somewhere just over $100K, depending on your point of view. JB has not suggested raising taxes on people of that income, that I have noticed. Only anonymous political bots.
==Not saying that $120K means champagne and caviar everywhere in Illinois, but you could have a decent life just about anywhere on that scratch.==
I suppose, but it’s all relative. That $120K person most likely lives in a place where all the public sector workers make more than average while receiving minimal state funding. You could argue they already paid.
I have a relative who’s lucky enough to teach in a mid/upper class school district that picks up her entire pension contribution. Her husband works in the private sector and contributes 12% of his earnings to a 401k. He figured that, for his take home pay to equal his wife’s, he had to gross 30% more than her. I guess the point is not all gross wages are created equal.
I wish someone had told me about that wonderful land where all the public sector workers earn more than average. I don’t understand that narrative at all, other than being something often said by people who want to blame public sector workers for all their problems and life choices. Similar things are often said by those people who have pension/benefit envy, but no one forced them to choose their careers.
But you’re right that overall compensation for public sector workers goes up relative to the private sector if you add benefits, but that is a well understood part of the deal. Lower pay, more stability, good health insurance. Studies (e.g. Governing magazine, link provided in the past) most public sector workers remain under compensated relative to their private sector counterparts for positions requiring a degree, some by a lot (e.g., doctors, rocket scientists).
Not sure how all of this relates to getting by on $120k, but there you go.
Poor Bruce. He was supposed to be able to greatly out spend the democratic nominee and create massive public interest in the issue that best promoted his candidacy. Can you imagine if this or Kennedy were the nominee.