* Tribune editorial…
It looks like Gov. J.B. Pritzker’s warning that Illinois will have to cut spending if voters reject his “fair tax” amendment wasn’t persuading anyone. And why would it? After years of busted budgets, rising debts and tax increases, millions of Illinois voters want state government to stop spending so much.
So Team Pritzker on Thursday dispatched Lt. Gov. Juliana Stratton to issue a new threat: Approve our amendment or, she said, “lawmakers will be forced to consider raising income taxes on all Illinois residents by at least 20% regardless of their level of income.” […]
We’ll see if Team Pritzker finds new ways to say, “Vote our way — or else.” But we hope nobody asks Lt. Gov. Stratton to be the one issuing future warnings. This was a message the governor should have delivered. This is his amendment, his campaign push, his threat to raise taxes on even the lowest of earners by a whopping 20%. How does the squeeze feel, Illinois?
* Ted Cox cranks up the Wayback Machine…
Here’s the thing, though: Gov. Pritzker first warned of a potential 20 percent tax hike in his very first budget address, a month after taking office, in February 2019. In the very same speech, he spoke of “a fair income tax” as a solution. Two weeks later, he laid out his proposal for a progressive income tax, with brackets that have basically held true to that initial vision: a higher tax rate only for those making more than $250,000 a year, with 97 percent of Illinois taxpayers paying the same or less than they are now under the current 4.95 percent flat tax.
The General Assembly approved a graduated income tax that spring, sending it on to voters in the general election this fall with Pritzker’s initial brackets only slightly altered up to a top tax rate of just under 8 percent for those making more than $1 million a year. The actual Fair Tax Amendment, however, only changes the state constitution to allow a graduated income tax.
None of that has changed over the last year and a half.
Now, journalists have notoriously poor memories. Dealing with news on a daily basis tends to leave old facts and information buried under the new — especially in these turbulent times. But one might well expect better from the Tribune Editorial Board — or Republican politicians.
* From the 2019 budget address, which can be found on the Tribune’s own website…
First, we could choose only to cut state government spending and raise no revenue. To do that, we have to recognize that out of this year’s $39 billion budget, approximately $20 billion is required payments on our debt, on our pensions, on our court-ordered obligations or federally protected programs. That leaves approximately $19 billion dollars. That’s the money we spend educating our children, running our colleges and universities, keeping our streets safe, preserving our natural resources, getting people to and from work efficiently and caring for our veterans. We’ll call that “discretionary spending.” To balance the budget by simply cutting government, we would have to reduce discretionary spending on all these direct services our jobs, our families and our businesses rely on by approximately 15%. That’s 15% fewer state police, 15% fewer students going to college, 15% fewer working parents receiving child care assistance, and 15% less money for your local schools – which likely also means your local property taxes will increase. I should point out that this option was tried in the prior administration, and it failed - because nearly no one thinks it’s a good idea to force our most talented kids to leave the state by diminishing Illinois colleges and universities, drive families away by defunding local schools, make our communities less safe by reducing public safety, and increase poverty by cutting badly needed human services.
Our second option is to raise revenue with our current regressive flat income tax system and impose more flat taxes which fall disproportionately on the working poor and the middle class. This option could require imposing sales taxes on services, implementing a retirement tax, or raising the income tax overall by around 20%. Or all of the above. For a family earning $100,000, that means paying almost a thousand dollars more in income taxes, and their property taxes will continue their upward march as they always have.
Our third option is to reject imposing additional income, retirement and sales taxes on the middle class and instead enact a fair income tax. This would lift some of the tax burden off of middle income earners and instead ask the wealthiest to pay a little more. Just for clarity, a fair tax is what three quarters of states with income taxes have. We can accomplish this with a more competitive rate structure than Wisconsin and Iowa, both of which are outpacing Illinois in job creation and economic growth. We can also implement a fair tax system that’s lower than our metropolitan competitors on the east and west coasts.