* Let’s begin our coverage of the governor’s graduated income tax press conference with this Tribune excerpt…
GOP lawmakers and a pro-business political committee called Ideas Illinois, run by former Illinois Manufacturers’ Association chief Greg Baise, have attacked Pritzker’s proposal as a “jobs tax” and argued that it would push businesses and wealthy residents out of state.
“For those who will oppose a fair tax by waging a misinformation campaign, it is transparent that you are defending an unfair status quo that benefits the wealthiest Illinoisans instead of offering your own ideas for how to fix our state’s problems,” Pritzker said.
The governor cited a report from PolitiFact Illinois that rated the “jobs tax” claim as false.
The PolitiFact rating is here.
I’m dubious of that rating because the “jobs tax” phrase is basically just an advertising slogan.
So, for instance, the Sun-Times calls itself “The Hardest-Working Paper in America.”
But is it “really” the hardest-working paper in all of America? I’m sure I could find experts, as PolitiFact often does, to establish some benchmarks about what hard work is, and about how reporters work very hard all over the country. I could then send an e-mail to the paper’s publisher asking him to justify the slogan, then follow up with maybe the Tribune’s publisher to see if he agreed. And then I could easily rate that slogan “False” or even “Pants on Fire!” because it wasn’t true.
Yes, that would be silly, but don’t we generally hold newspapers to a higher standard than dark money committees? Should they be allowed to run such misleading ad campaigns? Who’s going to speak for the children?!
* Onward…
The proposed amendment to change Illinois’ constitution from a flat income tax to one with higher rates for higher earners will get a last-minute hearing Wednesday in Springfield. […]
On Tuesday, state Sen. Don Harmon, D-Oak Park, requested the six-day posting requirements to hold a committee hearing be waived. He asked for his Senate Joint Constitutional Amendment No. 1, which includes language to change the state’s flat tax to a tax structure that levies higher rates on higher incomes, to be heard in the Senate Executive Committee on Wednesday.
State Sen. Dale Righter, R-Mattoon, objected.
“What’s at issue here is a substantive amendment to the Illinois constitution that will affect the finances and taxes of millions of Illinoisans,” Righter said. “At the very least, the six days notice required is appropriate for this body … to have a conversation about the contents of the amendment and the effects it might have on our constituents.”
I don’t particularly care for the posting waiver, either. But, really, what actual “conversation” can Senators have while the proposal awaits a committee hearing? Isn’t that what a hearing is for?
* The proposed constitutional amendment deletes this line from the existing document…
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.
* Republicans pounced…
Under the proposed language, they argued, the state would actually be allowed to levy multiple income taxes, each for a different purpose, which would effectively allow the state to tax the same income multiple times. […]
“That means it could set up for all kinds of surcharges,” Maisch said. “It means you could go ahead and actually have a second income tax to go ahead and fund, I don’t know, transportation or whatever the other need is. But they are eliminating that taxpayer protection that says, ‘this dollar of income can only be taxed once by the state.’” […]
According to Harmon, the prohibition on levying multiple income taxes was simply a companion to the requirement for a single, flat tax rate. Without that prohibition, he said, the framers feared that lawmakers could levy a series of “flat” taxes on different levels of income – say, for example, one on income up to $30,000; another “flat” rate on income between $30,000 and $60,000, and so on – effectively creating a multi-tiered tax structure through a series of limited “flat” taxes on different levels of income.
By allowing the state to create a multi-tiered tax structure, Harmon said, the prohibition on multiple taxes would become unnecessary.
Furthermore, he said, if supporters of the proposed change had left in the prohibition on multiple taxes, critics would likely argue that a multi-tiered structure would violate that prohibition.
* Here’s the newly originally proposed language…
There may be one tax on the income of individuals and corporations. This may be a fair tax where lower rates apply to lower income levels and higher rates apply to higher income levels. No government other than the State may impose a tax on or measured by income.
I get what Harmon is saying, but somebody may have over-thought that language deletion. They should’ve just left the originally proposed language in place.
…Adding… Um, so how does one get this headline…
Study: Pritzker’s tax hike more likely to force out middle, lower earners
From this?…
One of the arguments from opponents of Gov. J.B. Pritzker’s proposed progressive income-tax amendment to the Illinois Constitution is that another tax hike, particularly on upper-income earners, will encourage more people to leave the state.
But a new study conducted by Chicago’s Better Government Association contends that statistics do not support that contention. At the same time, the BGA study shows that the earners Pritzker says he cares about most — middle- and lower-income earners — are the hardest hit by tax increases and most likely to leave the state because of them.
Unlike all previous income tax hikes, this one would only be on upper-income folks.
- Honeybear - Wednesday, Apr 10, 19 @ 9:35 am:
I am just so disgusted by
Political Perfidy
all
the
time
- Thomas Paine - Wednesday, Apr 10, 19 @ 9:40 am:
The GOP should take the prohibition on Chicago or Cook County imposing a separate income tax as Indiana allows local government to do and declare victory.
This kills the commuter tax, I believe, which ought to make Republicans joyous.
- Donnie Elgin - Wednesday, Apr 10, 19 @ 9:42 am:
When you go from a flat tax that impact everyone equally to a graduated tax purposely tweaked to burden a certain population lots of folks will be watching the details/language/process. Limiting the time period on the hearing and changing the language raises a bunch of red flags.
- RNUG - Wednesday, Apr 10, 19 @ 9:43 am:
== 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. ==
There is a relatively easy change the IGOP should ask for: keeping this language in place
== … requested the six-day posting requirements to hold a committee hearing be waived. He asked for his Senate Joint ==
That tells you the fix is in for a lot of last minute arm twisting and deal making
- Thomas Paine - Wednesday, Apr 10, 19 @ 9:44 am:
PS: title on that Ideas Illinois ad is hilarious.
- Grandson of Man - Wednesday, Apr 10, 19 @ 9:46 am:
** “What’s at issue here is a substantive amendment to the Illinois constitution that will affect the finances and taxes of millions of Illinoisans,” Righter said. **
It would positively affect the vast majority of us. But the jig is up for the ILGOP and the opponents. They just want to protect the wealthiest from paying more. It’s not a jobs tax, nor will the rich leave or the middle class be crushed—at least not with the proposed rates.
Too bad the ILGOP doesn’t want to govern on this and offer votes for certain concessions and to improve the proposal. They just want to serve the wealthiest and scream on the sidelines.
- RNUG - Wednesday, Apr 10, 19 @ 9:46 am:
I don’t bloke the “fair tax” term or the “job tax” term. Both distract from the message.
What JB should be pushing all day long is that the graduated income tax is the Millionaire’s Tax the State voted for in the advisory referendum.
- DarkDante - Wednesday, Apr 10, 19 @ 9:46 am:
I’m no lawyer or legal scholar, but when I first read the language deletion, I thought it was intended to open up the door to local based income taxes (where tax payers are taxed a second, separate time by their municipality).
- Cheryl44 - Wednesday, Apr 10, 19 @ 9:48 am:
A flat tax does not impact everyone equally. I don’t miss that 4.95% of my paycheck that I never see. Someone making less than I do or have dependents might.
- Perrid - Wednesday, Apr 10, 19 @ 9:51 am:
I think it is supposed to be understood that “hardest working” is supposed to be hyperbole, or at least subjective. Saying the graduated income tax is a tax on jobs is just wrong, it makes no sense. Unless you want to say every tax is a job tax. Or maybe every income tax is a jobs tax? I don’t know what it’s supposed to mean, and I don’t think they do either, they just know phrasing it that way makes it more likely to scare people into thinking they will lose their jobs if their boss’ boss’ boss’ taxes go up. It’s a lie to scare people into voting against their own self interest.
- lake county democrat - Wednesday, Apr 10, 19 @ 9:51 am:
Pritzker says the alternative to his plan is a 15% cut in spending and asks the GOP for an alternative. Fair challenge An alternative could include a deal where the Pritzker plan is accepted in exchange for a tiny fraction of those spending cuts. They don’t have to be across the board, but there should be a default sequester (sparing certain programs) if Pritzker/Madigan can’t make more surgical cuts in spending.
I know, off-the-charts cruel, complete nonstarter,etc. But I ask this: many of the analyses Rich has posted warn about dire effects should we have a recession. Well, the majority of economists predict a recession to begin sometime in the next two years. What do you do then to get revenue for those programs? Raise taxes in a recession? Wouldn’t that make the “downward spiral” much more likely than it is now or under the Pritzker plan? Wouldn’t the state be better off making the cuts now, when the sun is shining? I’d prefer Pritzker should bump-up his top tax rate (maybe to 8.1%) and target some of that money combined with the savings from spending cuts into the rainy day fund. Might even impress the bond raters.
- notsosure - Wednesday, Apr 10, 19 @ 9:52 am:
There’s an amendment–you quoted the original resolution’s language. Not that it matters much–neither kept that (unnecessary, as Senator Harmon pointed out) “single tax” requirement. It does leave open a local income tax option, which some versions of this resolution have explicitly prohibited.
- Responsa - Wednesday, Apr 10, 19 @ 9:55 am:
It will be argued forever what “Fair tax” means. It has no legal meaning and does not belong in Constitutional language. Call it what it is. A graduated income tax.
- City Zen - Wednesday, Apr 10, 19 @ 9:58 am:
==What JB should be pushing all day long is that the graduated income tax is the Millionaire’s Tax==
250,000
- wordslinger - Wednesday, Apr 10, 19 @ 10:00 am:
–Study: Pritzker’s tax hike more likely to force out middle, lower earners–
Poor people will leave because their taxes aren’t raised?
That dude hit his pumpkin on something hard or is just willfully dishonest, and not very good at it.
- Old Illinois - Wednesday, Apr 10, 19 @ 10:00 am:
I always took the Sun-Times “Hardest Working…” slogan to mean that they were understaffed.
- ADM Stockd'le - Wednesday, Apr 10, 19 @ 10:01 am:
“But, really, what actual “conversation” can Senators have while the proposal awaits a committee hearing? Isn’t that what a hearing is for?”
A conversation with:
constituents
staff
caucus
opposition
Governor
legislative leaders
lobbyists
Dept of Revenue
stakeholders
et cetera
- Anon - Wednesday, Apr 10, 19 @ 10:06 am:
I love that the jobs tax stuff is in an ad right above this post.
- Fixer - Wednesday, Apr 10, 19 @ 10:07 am:
lake county dem, that’s actually a reasonable suggestion, and something, were ILGOP willing to be a part of the process, that could be achievable. I said it before, but they’ve boxed themselves into a corner on this issue by coming out so soon saying they were completely against the proposal as opposed to negotiating on it. That kind of mentality might have worked with Rauner in the governor’s office, but they’ll have to learn how to actually govern again if they ever want to have some relevancy in this state again.
- Phil King - Wednesday, Apr 10, 19 @ 10:08 am:
==Unlike all previous income tax hikes, this one would only be on upper-income folks.==
Because you say so?
This is nothing but a bait and switch.
–Change the constitution to make it easier to hike taxes on single slices of taxpayers one at a time.
–Complain that your initial plan didn’t raise as much as you thought or as much as you want to spend.
–Move the higher rates down the income brackets, hiking taxes on everyone.
–Profit?
- Fixer - Wednesday, Apr 10, 19 @ 10:13 am:
Phil, source for your claim it’s a bait and switch tactic that isn’t Ideas Illinois’ apoplectic rantings? I’ll wait.
- SSL - Wednesday, Apr 10, 19 @ 10:16 am:
Actually JB’s proposal does protect the wealthiest. By having those that earn $5MM, $10MM and $20MM or more pay essentially the same rate as households earning $250,000, he has violated the principle he campaigned on. That plus the pension can kicking routine makes him no better than his predecessors.
- Nick Name - Wednesday, Apr 10, 19 @ 10:17 am:
===…Adding… Um, so how does one get this headline…===
By being the News-Gazette.
- wordslinger - Wednesday, Apr 10, 19 @ 10:18 am:
–Profit?–
Was that just some leftovers you threw into your crystal ball word salad, or is it supposed to have some meaning, in context?
- El Conquistador - Wednesday, Apr 10, 19 @ 10:21 am:
Phil’s source is simply desperate ILGOP spin.
- Lester Holt’s Mustache - Wednesday, Apr 10, 19 @ 10:24 am:
==–Move the higher rates down the income brackets, hiking taxes on everyone.==
So….what, you prefer they raise everyone’s taxes right now? If taxes are going to be raised one way or another, why should we want to them to instead increase taxes on a larger number of people immediately? I’d at least want to minimize the number of taxpayers affected in any way possible. If that means several years or a decade before the tax increase eventually hits middle and lower class income earners, that’s better than including everyone right now
- Perrid - Wednesday, Apr 10, 19 @ 10:25 am:
Phil King, the deal on the table is an increase on upper income folks. Your fears for the future may or may not turn out to be founded, but at the moment they are speculation only.
I mean, come on. They could hike taxes on everyone RIGHT NOW. They don’t have to have a graduated income tax to do that. The only reason to implement it is to NOT hike everyone’s taxes.
- Steve - Wednesday, Apr 10, 19 @ 10:29 am:
- Fixer -
That’s the history of many taxes. The federal income got passed because they promised to lower the tariff : they did and then in less 25 years the tariff got back at its’ old rate with high income tax rates. In Illinois, before 1969 , we had no income tax. When we got it they promised it would be small and flat. The toll roads weren’t supposed to permanent : but now they are. Future legislators can’t be bound by the promises of today’s legislators. Once you have a progressive tax , what is going to stop a marginal rate of 8% on 43k when money is needed for public pensions that no one wants to cut?
https://www.tax-brackets.org/californiataxtable
- Jocko - Wednesday, Apr 10, 19 @ 10:30 am:
==nothing but a bait and switch==
The millionaires tax referendum won soundly (unlike BVR in 2014) and Bruce and the legislature sat on this for years. Given our need for revenue…the “you’ll be sorry” bit is wearing thin.
- wordslinger - Wednesday, Apr 10, 19 @ 10:32 am:
–Once you have a progressive tax , what is going to stop a marginal rate of 8% on 43k when money is needed for public pensions that no one wants to cut?–
You’ve heard of elections, right?
- RNUG - Wednesday, Apr 10, 19 @ 10:37 am:
== when money is needed for public pensions that no one wants to cut? ==
Let’s be honest here. A fair amount of people want to cut the pensions; they can’t cut the pensions because of the Pension Clause and various IL SC rulings.
- wordslinger - Wednesday, Apr 10, 19 @ 10:41 am:
–I said it before, but they’ve boxed themselves into a corner on this issue by coming out so soon saying they were completely against the proposal as opposed to negotiating on it.–
They need money. Rauner was virtually the sole funder of the ILGOP. Now Rauner’s gone, and so is his checkbook. They need the money of the folks bankrolling the Baise and IPI campaigns.
- Just Observing - Wednesday, Apr 10, 19 @ 10:43 am:
=== Once you have a progressive tax , what is going to stop a marginal rate of 8% on 43k when money is needed for public pensions that no one wants to cut? ===
I’m not even necessarily in favor of the proposed progressive tax, but Rich did pretty thoroughly answer this the other day.
- Rich Miller - Wednesday, Apr 10, 19 @ 10:50 am:
===Because you say so? ===
No, because that’s what will pass. Everything else is conjecture from opponents.
- Louis G Atsaves - Wednesday, Apr 10, 19 @ 10:51 am:
Its about time they air this out completely and take that 6 day rule suspension out. Labeling the progressive tax opponents as advocating only for the wealthy and other dumb comments aren’t helping the pro side of things.
Most who I have spoken to seem to think the progressive tax will not affect them and the rich will pay for it all, including deficits carried over from multiple years, fixing roads, bridges, paying into pension programs, and healthcare and schools with lowered property taxes. Gas tax increases? Property taxes still going up? Taxes on legal weed? Sports betting? Selling the tollway? Huh? What? Is their shocked response.
They also seem to think the progressive is a one time fix and the tax rates will never be adjusted again.
As a die hard super-duper Minority Republican, all I can say is go ahead super-duper majorities, ram it through. Mimic those tin ears that sure thing Preckwinkle wore during her mayoral race.
- Rich Miller - Wednesday, Apr 10, 19 @ 10:52 am:
===what is going to stop a marginal rate of 8% on 43k===
You’re just pulling stuff outta thin air now. Take a breath already.
- Vilolet Seepage - Wednesday, Apr 10, 19 @ 10:52 am:
No argument that the super-rich can afford to pay more. But it’s the small business owners — those in Subchapter S corporations or Limited Partnerships that are taxed at individual rates — that would get hit hard. And you cannot look at this move to increase taxes on most of these businesses in a vacuum. Small business owners perceive Springfield as already anti-business, and to them, perception is reality. That’s why so many successful Illinois-based small businesses–especially manufacturers–have expanded in other states.
IMO, the ‘jobs tax’ tag has a ring of truth.
- Chicago Cynic - Wednesday, Apr 10, 19 @ 10:54 am:
Rich,
I’m really glad you pointed out that Jim Dey headline in the News-Gazette. I read the head and the lead to his story and it’s positively bizarre. There’s simply no relation and no overlap between what the BGA analysis said and the Jim Dey headline. Seriously people, please try and do better.
- dave ristau - Wednesday, Apr 10, 19 @ 10:56 am:
I agree with Phil.
Bait and switch. The rich do not have that much money . I say just raise the income tax 2 percent and get on with life.
- Steve - Wednesday, Apr 10, 19 @ 10:56 am:
What’s more probable in the next 15 years in Illinois ?
1)A constitutional change in the pension clause
2)8% marginal income tax rate on 43K
- PublicServant - Wednesday, Apr 10, 19 @ 10:57 am:
===…small business owners — those in Subchapter S corporations or Limited Partnerships that …===
If they’re making a net profit of north of $250,000/year they’re doing fine, and they’ll continue to do just fine under the graduated income tax.
- PublicServant - Wednesday, Apr 10, 19 @ 10:58 am:
===The rich do not have that much money===
Wait…what?
- PublicServant - Wednesday, Apr 10, 19 @ 10:59 am:
===What’s more probable in the next 15 years in Illinois ?
1)A constitutional change in the pension clause
2)8% marginal income tax rate on 43K===
3) Steve making no sense
- d. p. gumby - Wednesday, Apr 10, 19 @ 11:09 am:
Did “BadIdeas Illinois” consult w/ Frank Luntz to create the “jobs tax” the same way we got “death tax”??
- Jocko - Wednesday, Apr 10, 19 @ 11:12 am:
==The rich do not have that much money.==
Without including BVR, Forbes has the top 13 in Chicago worth a combined 42.7 billion.
- Fixer - Wednesday, Apr 10, 19 @ 11:16 am:
“Future legislators can’t be bound by the promises of today’s legislators.”
I think you kind of made my argument for me there. Everyone wants services from the state. This helps to pay for that. What future legislators may or may not do is frankly less constructive than screaming into the wind.
- Whatever - Wednesday, Apr 10, 19 @ 11:18 am:
Harmon is absolutely correct about the “one tax” language — it was expressly added to prevent an end run around the flat tax language by having multiple flat taxes, with one applying to all incomes, one applying only to incomes over $100,000, etc. But there is no reason to delete this language, either.
Regarding the prohibition in the original bill against local income taxes, I think it should be left in. Article VII, Section 6(e) allows home rule units to impose income taxes only as provided by law by the GA. That language should be amended, too.
- Anon - Wednesday, Apr 10, 19 @ 11:25 am:
Every tax increase we have ever had hasn’t been enough.
Why on earth do people think this will be any different?
Rich telling folks to take a breath when history shows that the state will inevitably be back hat in hand when the proposed tax increase doesn’t generate enough revenue is laughable.
- Nick Name - Wednesday, Apr 10, 19 @ 11:26 am:
===public pensions that no one wants to cut?===
If you can get the votes in the GA and in the public at large to turn pensions into a political football, then go for it.
- Last Bull Moose - Wednesday, Apr 10, 19 @ 11:27 am:
The Republicans abandoned the field by refusing to recognize that change was coming. They can oppose it and be steamrolled or accept change and shape it. Looks like they prefer being squished.
- Nick Name - Wednesday, Apr 10, 19 @ 11:28 am:
===The rich do not have that much money .===
OMG
- wordslinger - Wednesday, Apr 10, 19 @ 11:36 am:
–That’s why so many successful Illinois-based small businesses–especially manufacturers–have expanded in other states.–
Huh? Manufacturers are only taxed on income from in-state sales.
You’re all over the place — are you claiming manufacturers are filing as limited partnerships?
Proof once again that when someone employs “perception is reality,” expect a whole lot of nonsense.
- Responsa - Wednesday, Apr 10, 19 @ 11:49 am:
==If you can get the votes in the GA and in the public at large to turn pensions into a political football, then go for it.==
Obviously, those are two completely different processes and would be two different votes. But if a pension clause change *did* make it past the GA and out to a vote of the general public I think many contributors here might be surprised at the result.
- wordslinger - Wednesday, Apr 10, 19 @ 11:55 am:
–Without including BVR, Forbes has the top 13 in Chicago worth a combined 42.7 billion.–
Think those Pritzkers on the list will move if there’s a graduated income tax?
- City Zen - Wednesday, Apr 10, 19 @ 12:03 pm:
==What’s more probable in the next 15 years in Illinois ? 1)A constitutional change in the pension clause 2)8% marginal income tax rate on 43K==
8% on $100-$250K is far more likely.
I don’t think those 2 lowest tax brackets will ever budge much. There are too many voters in those brackets.
- Rich Miller - Wednesday, Apr 10, 19 @ 12:09 pm:
===Think those Pritzkers on the list will move===
lol
Although most of their money is already safely stashed offshore or in South Dakota.
- Michelle Flaherty - Wednesday, Apr 10, 19 @ 12:14 pm:
To answer the question, yes, the Sun-Times is the hardest working paper.
- wordslinger - Wednesday, Apr 10, 19 @ 12:15 pm:
–But if a pension clause change *did* make it past the GA and out to a vote of the general public I think many contributors here might be surprised at the result.–
Don’t leave us in suspense — tell us what it would say and what it would accomplish?
- Nonbeleiver - Wednesday, Apr 10, 19 @ 12:20 pm:
Job Tax. Fair Tax.
Those phrases alone tell you all you need to know about obfuscation.
- Occasional Quipper - Wednesday, Apr 10, 19 @ 1:01 pm:
–Pritzker says the alternative to his plan is a 15% cut in spending and asks the GOP for an alternative. –
Here’s an idea…how about no new programs until the budget starts running a surplus? Or is at least back in balance. A week ago the House passed HB2237 which is bill to start a college savings account for every child born or adopted in the state. The logic was based on a statistic that showed that if there is any amount saved in a college savings account then the child is 3 times more likely to attend college and 4 times more likely graduate. This is a misapplication of statistics based on a misunderstanding of cause and effect. The savings account didn’t cause more kids to go to college. It was having parents or guardians who cared enough about their kids’ future to set up a college savings account. But they didn’t just open the account and call it done. They were there, every step of the way, constantly encouraging their kids to grow and to achieve things they never thought possible. That’s something that the mere existence of a savings account can’t do by itself.
But the real point is there is no money for new programs like this. Anyone who has had to get a personal budget back in balance knows that the first thing you do is stop spending money on things that aren’t absolutely necessary. Look up the SNL skit with Steve Martin called Don’t Buy Stuff You Cannot Afford. Not only is it very funny, but it’s also that best advice to ever come out of that show. The state could learn a lot from that one.
- SOIL M - Wednesday, Apr 10, 19 @ 1:11 pm:
Although most of their money is already safely stashed offshore or in South Dakota.
Exactly. Add to that the fact that the Governor who says everyone should pay their “Fair Share” worked hard to make sure he didn’t have to pay his Fair Share in property taxes and shifted those costs to those less fortunate. Then add in a lawyer who makes a tidy sum by helping the wealthy and we’ll connected avoid paying their Fair Share. And you find the answer as to why people just don’t trust them or believe what they say about only raising taxes on the top 3 percent will be plenty of money.
- Whatever - Wednesday, Apr 10, 19 @ 2:24 pm:
Stashing the Governor’s money offshore does not prevent the IRS or Illinois from taxing it. If you know about it, so does the IRS and he is paying just as much federal and state tax on it as he would if the money was stashed in a Chicago bank.