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Kiplinger rates Illinois the least tax-friendly state for middle class families

Tuesday, Nov 23, 2021

* Kiplinger

When creating our State-by-State Guide to Taxes on Middle-Class Families, we estimated the overall income, sales, and property tax burden in each state and the District of Columbia for a hypothetical married couple with two children, combined wages of $77,000, $3,000 of other income, and a $300,000 home. That information also allowed us to cobble together the following list of the 10 least tax-friendly states for middle-class families (the least-friendly state is listed last).

* Illinois came in dead last

    • State Income Tax Range: 4.95% (flat rate)
    • Average Combined State and Local Sales Tax Rate: 8.83%
    • Median Property Tax Rate: $2,165 per $100,000 of assessed home value

Sorry, Illinois, but you’re the least tax-friendly state in the country for middle-class families. For all three taxes we’re tracking – income, sales, and property taxes – you tax middle-income residents at an above average rate (at least). And for one of those taxes, the rates are extremely high. That’s enough to put the Land of Lincoln in the most undesirable spot on our list.

At first blush, the state’s 4.95% flat income tax rate doesn’t seem that steep when compared to other states’ top tax rates. And that’s true if you’re talking about wealthy residents. But for middle-class taxpayers, the income tax rate is on the high end. When we ran tax returns for all 50 states and the District of Columbia for our hypothetical middle-class family, the Illinois income tax bill was tied for the ninth-highest in the country.

Sales taxes in Illinois are high, too. There’s a 6.25% state tax on purchases in Illinois (1% on groceries and prescription drugs). Plus, up to 4.75% in local taxes are tacked on in certain places within the state. All told, the average combined state and local sales tax in Illinois is 8.83%, which is the seventh-highest combined sales tax rate in the U.S.

The tax situation really goes downhill fast for Illinois residents when you look at the property taxes they have to pay. Property taxes in Illinois are the second-highest in the nation. If our hypothetical family purchased a $300,000 home in the state, their average annual property tax bill would be an eye-popping $6,495.

A graduated income tax could’ve eventually eased all those issues, but whatevs. Five of the “most-friendly” states all had graduated income tax rates. The other five had no income tax.

- Posted by Rich Miller        

86 Comments »
  1. - SWIL_Voter - Tuesday, Nov 23, 21 @ 9:17 am:

    As the people want it. They had a chance to change all of this with the fair tax and they decided they’d rather keep pounding the middle class. Makes no sense to me, but I’m clearly in the minority in thinking we should have progressive taxation


  2. - Frank talks - Tuesday, Nov 23, 21 @ 9:19 am:

    This is surprising to no one in the collar counties


  3. - Just Me 2 - Tuesday, Nov 23, 21 @ 9:22 am:

    The property taxes is what kills us. They’re just so high and the Democrats have done nothing to even attempt reform. Every time I ask a legislator about I’m simply told they’re working on it. I wish they spent half as much time working on property taxes as they did their new gerrymandered map.


  4. - Honeybear - Tuesday, Nov 23, 21 @ 9:24 am:

    Interesting that they of course excluded taxation of retirement income which Illinois does not tax. I wonder how we would fair in that scenario if taxation of retirement income were added into the equation?


  5. - Demoralized - Tuesday, Nov 23, 21 @ 9:25 am:

    ==have done nothing to even attempt reform==

    The only reform you can do is to cut property taxes while simultaneously raising the income tax or some other tax to take the place of that revenue. People want their property taxes cut but they don’t want any other taxes increased. That’s just not possible to do.


  6. - Rich Miller - Tuesday, Nov 23, 21 @ 9:26 am:

    === People want their property taxes cut but they don’t want any other taxes increased===

    People generally believe they’ll see an income tax hike and never see the property tax reduction.


  7. - Publius - Tuesday, Nov 23, 21 @ 9:27 am:

    On property taxes most all of it goes to schools. Again that could have been fixed with a graduated tax but no one wanted to talk about it. For cities and towns that is for Police and Fire. Guess these people want to defund the Police. Again it can be fixed but someone will pay more but we don’t want to have that conversation. Also, property taxes may be high but compared to the coasts but property values are lower so the burdern is much less overall.


  8. - Al - Tuesday, Nov 23, 21 @ 9:27 am:

    The standard deductions and exemptions do not reflect economic reality. Neither do the low tax rates on liquor sales. We subsidize liquor, make unpleasant tasks for police, EMTs and emergency room staff and clog our courts with negative nonproductive forms of economic activity.

    A graduated income tax is a false panacea. What is required are higher liquor taxes and reasonable closing hours for taverns combined with meaningful increases in the standard deductions. No One is keeping a room over their head and food on the table on two grand a year in Illinois. Last call at 10 pm and close the tavern doors at 11pm. This is a scientifically proven means of preventing violence.


  9. - Oswego Willy - Tuesday, Nov 23, 21 @ 9:27 am:

    With property taxes a local taxing issue, and schools being that taxing body with the biggest bite, reform, no matter what ridiculous thought to it, must include a funding of K-12 schools that allows relief while still funding at acceptable levels that “suburban folk” will also feel a quality education is the goal and it’s being achieved.


  10. - TheInvisibleMan - Tuesday, Nov 23, 21 @ 9:30 am:

    If they are going to use average property taxes, why are they also not using average home prices.

    Aside from the fact that property taxes are not controlled by the state, rankings like this have far too many variables which can be manipulated to get the desired outcome needed for the article. Using a much higher average home price, but then using average taxes is a great way to increase the ‘average’ tax rate, if one was so inclined.

    My property taxes today, are lower in both rate and dollar amount paid than they were in 2010.

    Is that average. No it is not. Because the average behavior of local boards is mostly incredibly wasteful and unsustainable.

    Never forget the prime maxim of real estate-

    Location. Location. Location.


  11. - froganon - Tuesday, Nov 23, 21 @ 9:40 am:

    @Just Me 2 - Tuesday, Nov 23, 21 @ 9:22 am:

    -The property taxes is what kills us. They’re just so high and the Democrats have done nothing to even attempt reform.-

    The Dems helped raise the current income tax rate - twice and tried to get a graduated income tax passed. The Repubs. fought them every step of the way. Voters nixed the best solution because of a well organized and financed campaign by the billionaires club. A graduated income tax would allow the state to reduces property taxes. The voters don’t want the billionaires to pay, they would rather pay more in fees than trust future legislators to reduce property taxes.


  12. - ChicagoBars - Tuesday, Nov 23, 21 @ 9:42 am:

    T-H-I-S (insert banned punctuation).

    == People generally believe they’ll see an income tax hike and never see the property tax reduction. ==


  13. - Anyone Remember - Tuesday, Nov 23, 21 @ 9:44 am:

    These guys are as bad as Truth in Accounting (Board of Directors includes Dan Proft). #5, Alaska, gets 95% of funds from oil extraction taxes and federal $. #1, Wyoming, gets over 60% of funds from coal extraction taxes. #2 Nevada & #3 Florida, what do they call tourists? “Taxpayers who can’t vote.”

    And relative to their economies, all have military / space program federally funded jobs.


  14. - Blue to the Bone - Tuesday, Nov 23, 21 @ 9:47 am:

    These kinds of articles always drive me a little crazy because they’re not really doing anyone a favor when making the comparisons. Sure, tax rates in IL are higher but I’m not seeing living in Wyoming or North Dakota being a great option for me. Am I going to be able to make the same amount of money doing what I’m doing here if I move? I’m not sure. Am I going to have the same accessibility to healthcare and good hospitals in Alaska if I get sick? And I’m definitely not going to have the same amount of entertainment options. What professional sports team calls Wyoming home again?

    Yes, the graduated tax would have helped but what can you do. People vote the way they vote (and typically against their best interests IMHO). So our property taxes end up making up the difference, especially in communities that don’t have any manufacturing supporting their tax base. But we all know that.

    But this isn’t to say that we can’t do better. But doing better involves a lot of effort.


  15. - Responsa - Tuesday, Nov 23, 21 @ 9:49 am:

    Some people who are not concerned about outward migration (which was featured in yesterday’s thread here) may not fully appreciate the drain on all aspects of the the state’s tax base (property, sales, etc.) that goes along with middle class population loss.


  16. - Furtive Look - Tuesday, Nov 23, 21 @ 9:50 am:

    Most people I know don’t live in $300,000 houses.


  17. - Original Anon - Tuesday, Nov 23, 21 @ 9:50 am:

    The real problem for Illinois is that there are few levers to use in the future to raise revenue for government. Property and sales taxes are relatively high. A graduated income tax can only add so much without raising taxes on the ‘middle class.’


  18. - Numbers Guy - Tuesday, Nov 23, 21 @ 9:51 am:

    I would like to see this group do a similar list, but for high income earners.


  19. - Flyin' Elvis'-Utah Chapter - Tuesday, Nov 23, 21 @ 10:05 am:

    Enjoy all the culture and entertainment that the state of Wyoming has to offer.


  20. - Lincoln Lad - Tuesday, Nov 23, 21 @ 10:06 am:

    Illinois is tax friendly state for Ken Griffin since we voted down the graduated tax. We should all realize he’s more important than the middle class… that’s how we voted after all.


  21. - DuPage Moderate - Tuesday, Nov 23, 21 @ 10:08 am:

    Yeah, this ranking is because of us, the voters for voting down the “Fair Tax.” No mention at all about the politicians that got us in this mess?


  22. - Oswego Willy - Tuesday, Nov 23, 21 @ 10:10 am:

    After reading yesterday’s post and the must read piece in the Tribune attached to it, folks were discussing “crime” as a mitigating factor, especially to the Chicago angle. Now it’s a discussion to taxes, and the two being strong reasons for outward migration (which I’m not arguing against) but aren’t we seeing a greater migration from downstate and outside Chicago? Aren’t small towns and smaller counties feeling the outward migration more?

    One reason people are moving is that housing prices are at an all-time high, and for that to also be true there must be a demand for these houses.

    I say all that knowing full well that Kendall County, where I reside, is an island of real measurable growth on a national scale, even described so in the Tribune this past August, if you’d like reference.

    Schools in Kendall are more than adequate, homes are being built and bought up with the full knowledge of property tax levies. The region up here has appeal, but what it doesn’t have is a manufacturing tax base, stronger rapid transit, and it’s not a downstate country bleeding people or jobs.

    The problem in property taxes begins and ends with school funding. Reform outside of not factoring in schools will lead to greater inequality in districts… maybe.


  23. - Oswego Willy - Tuesday, Nov 23, 21 @ 10:11 am:

    === No mention at all about the politicians that got us in this mess?===

    (Sigh)

    Do you want solutions or do you want blame?

    Those who continually look back for solutions never find a solution for a tomorrow but merely scapegoats for today


  24. - Commisar Gritty - Tuesday, Nov 23, 21 @ 10:12 am:

    Can’t you argue that their methodology is pretty flawed here? Your income potential in Illinois is a lot higher than other states with lower costs of living. Sure it might be duel income of 80k in Mississippi or Ohio, but in Illinois you could be making 110k. We are not a state that is driven by minimum wage jobs, and even in that case, our minimum wage is significantly higher than most of the midwest.

    I’d say this study has some problems.


  25. - DuPage - Tuesday, Nov 23, 21 @ 10:13 am:

    ===People generally believe they’ll see an income tax hike and never see the property tax reduction.===

    This exact thing happened in the Edgar administration. There was an increase in the income tax rate, much of it to be sent to local schools and local governments. Edgar said the schools and local governments should then be able to roll back their property tax an equal amount. That part did not happen. Some of them put on theatrics, with photos in the papers with headlines of “county board cuts taxes”. The cuts were a couple pennies on the dollar of their new revenue. Just enough to say “we cut your taxes”. The end result was both higher state and high property taxes, especially the collar counties.


  26. - DuPage - Tuesday, Nov 23, 21 @ 10:22 am:

    Edgar trusted the schools and local governments to cut their property taxes a significant amount. They proved to be untrustworthy.


  27. - 47th Ward - Tuesday, Nov 23, 21 @ 10:23 am:

    I think income taxes are easier to understand and fairer by design. For example, in Chicago, homes are allegedly assessed using a system that tries to control for actual value to make tax burdens comparable. A home worth $500,000 should be assessed similarly whether that home is located in Englewood or Lincoln Square.

    The problem, as I see it, is that the services one receives for their property taxes varies. In some neighborhoods the local school is abysmal. In other neighborhoods, the local school is fantastic. But using the current formula, I have to pay the same to support a failing local school as someone with a similar home might pay to support a school that is great. And my kids are shut out of the great school?

    Equalized assessment, but unequal services, that’s a recipe for disaster and that’s what we have in Illinois. That’s another reason people hate the property tax.


  28. - Back to the Future - Tuesday, Nov 23, 21 @ 10:25 am:

    I did vote for the progressive tax idea, but I never thought it would reduce the overall tax rate in Illinois.
    I did think it was a good step in reforming and adjusting the tax code to be more far.
    I still think the idea failed so badly because people did not trust our state officials to spend the additional 3.5 Billion responsibly.
    Mr. Griffin might tax credit for the defeat of a more progressive tax and people may want to blame him for the defeat, but the vote was overwhelming and had more to do with a lack of faith in our elected officials than a rejection of a fairer tax approach.
    The idea that generally people didn’t think an income tax increase would reduce overall taxes was spot on.


  29. - Joe Bidenopolous - Tuesday, Nov 23, 21 @ 10:26 am:

    =Most people I know don’t live in $300,000 houses.=

    Anecdote isn’t data. Most of the houses in the state are in Chicago and the suburbs and most of those houses are well north of $300,000


  30. - TheInvisibleMan - Tuesday, Nov 23, 21 @ 10:28 am:

    “homes are being built and bought up with the full knowledge of property tax levies”

    A large percentage of people become angry at property tax increases in about the second or third year of new homeownership for one very specific reason.

    When a new house is built, the first years property taxes are still paying for the year before, or the period of time when the land was vacant. When the property taxes due advance to the year after the house was built, the amount increases to account for the now new house. At tax bill can easily go from 1k to 7k in a single year in these cases.

    Hardly anyone explains this to new home buyers. Not the bank, and certainly not the developer selling the home.

    It’s certainly a shock, but it’s also a sign of a buyer not understanding how property taxes work. Not a problem with high property taxes.


  31. - muon - Tuesday, Nov 23, 21 @ 10:29 am:

    The proposed progressive tax would not have made this report look much better for Illinois. The legislation that was passed to go along with the constitutional amendment dropped the rate from 4.95% to 4.9% on income between 10 K$ and 100 K$. That means the 80 K$ used for their benchmark wouldn’t have seen much change even if the amendment and accompanying bill would have passed.


  32. - Joe Bidenopolous - Tuesday, Nov 23, 21 @ 10:32 am:

    ===A home worth $500,000 should be assessed similarly whether that home is located in Englewood or Lincoln Square.===

    And yet, we know that’s not the case. Case in point - we paid about 30% more for the house we live in now than what we sold our last house for, but our property taxes on this house are about 25% less than the previous house.


  33. - Oswego Willy - Tuesday, Nov 23, 21 @ 10:32 am:

    ===Equalized assessment, but unequal services, that’s a recipe for disaster and that’s what we have in Illinois. That’s another reason people hate the property tax.===

    How often is it heard “I pay more in property taxes than ‘X’ and they have better schools?”

    === Mr. Griffin might tax credit for the defeat of a more progressive tax and people may want to blame him for the defeat, but===

    … he funded it, and went out of his way to defeat it.

    “I mean, other than *that*”

    ===Edgar trusted the schools and local governments to cut their property taxes a significant amount. They proved to be untrustworthy.===

    That’s too simple, looking at 308 here in Oswego or New Trier, as another example, both districts are trying to serve communities wanting the best public education and find a need to raise taxes to pay for those educations.

    I say that because when districts decide to cut, say, band, sports, arts, extra curriculars, parents beef.

    Do we hear about those beefing in New Trier more or maybe from an Oswego more when it comes to this?

    There is a reality of K-12 education is a “keeping up with the Joneses” but the Joneses are Naperville schools, New Trier schools… it’s not that anyone was disingenuous, the competition to… well, compete… was the heavier burden than to the burden to cut.


  34. - Rich Miller - Tuesday, Nov 23, 21 @ 10:32 am:

    ===Can’t you argue that their methodology is pretty flawed here? Your income potential in Illinois is a lot higher than other states with lower costs of living.===

    California is on the “most friendly” list. Kinda blows your argument out of the water.


  35. - Joe Bidenopolous - Tuesday, Nov 23, 21 @ 10:32 am:

    I should clarify - both houses are in the city and separated by less than a mile


  36. - bball_coach - Tuesday, Nov 23, 21 @ 10:37 am:

    -They proved to be untrustworthy- This in my opinion is why the graduated tax rate failed. (By they I mean legislators, governor etc.)


  37. - SWIL_Voter - Tuesday, Nov 23, 21 @ 10:39 am:

    I obviously heard all the distrust out there when talking to voters but the problem can never be fixed if we explicitly prohibit our elected leaders from fixing it. There simply aren’t ways to fix it that don’t require some trust.


  38. - City Zen - Tuesday, Nov 23, 21 @ 10:42 am:

    ==They had a chance to change all of this with the fair tax==

    Nope. Property tax and sales tax are the two main drivers for tax burden for the middle class. Meanwhile the extra revenue raised from the fair tax offered microscopic property tax relief and no sales tax reform. In other words, the fair tax didn’t reduce the tax burden for the middle class.

    If you’re implying a progressive income tax was the first step, then you’re saying the rates were going to go up, which means more than the top 3% of taxpayers would have been impacted. Which goes full circle to why it failed: trust.


  39. - bball_coach - Tuesday, Nov 23, 21 @ 10:43 am:

    I would say trust is earned not given to folks that have not given us any reason to trust them.


  40. - Oswego Willy - Tuesday, Nov 23, 21 @ 10:44 am:

    ===In other words, the fair tax didn’t reduce the tax burden for the middle class.===

    The fact that 97% would not see, at minimum, a tax increase, but more revenue would be generated is where Griffin fooled so many folks, voting against their best interests, but still this idea that Griffin might even be a “hero” to the middle class, LOL


  41. - RNUG - Tuesday, Nov 23, 21 @ 10:46 am:

    == Anecdote isn’t data. ==

    If you ask the Realtors association, the average is $227,500.

    If you ask Zillow, the average is $243,355.

    If you ask the Motley Fool, the answer is either $233,361 or $235,641.

    All those are a fair amount below $300,000.


  42. - Rich Miller - Tuesday, Nov 23, 21 @ 10:48 am:

    ===Nope. Property tax and sales tax are the two main drivers===

    Why do you think those are so high?


  43. - thisjustinagain - Tuesday, Nov 23, 21 @ 10:51 am:

    Planning to move to NW Indiana. Comparable Illinois houses have taxes 2-4 times Indiana tax rates. Plus there is a $3,000 mortgage deduction, and homestead and supplemental homestead deductions, plus local tax rates varying between ~40-60% lower than Cook County.


  44. - Back to the Future - Tuesday, Nov 23, 21 @ 10:52 am:

    I agree that Mr. Griffin helped fund the anti “Fair Tax” opponents. While the funding for both sides was about equal, I also think the opponents did a better marketing job. For example that older gray haired pleasant lady warning us about taxing retirement income was very good, but the progressive tax idea loss was so overwhelming that a lot more had to be going on than a better marketing and educational campaign by opponents or our State Treasurer putting his foot in his mouth.


  45. - DuPage Saint - Tuesday, Nov 23, 21 @ 10:55 am:

    I would love to have that tax rate for my real estate taxes. I pay over 9 grand and my house is not much over 300.


  46. - thechampaignlife - Tuesday, Nov 23, 21 @ 10:59 am:

    ===Anecdote isn’t data. Most of the houses in the state are in Chicago and the suburbs and most of those houses are well north of $300,000===

    Opinions also are not data. From the Census QuickFacts for Illinois: Median value of owner-occupied housing units, 2015-2019 = $194,500.


  47. - City Zen - Tuesday, Nov 23, 21 @ 11:03 am:

    ==The fact that 97% would not see, at minimum, a tax increase==

    Kiplinger would still have rated IL middle-class families at the bottom had it passed. That was my point. That middle-class tax burden remained high under the fair tax.


  48. - Oswego Willy - Tuesday, Nov 23, 21 @ 11:05 am:

    === Kiplinger would still have rated IL middle-class families at the bottom had it passed.===

    How do you know that? I didn’t see that written.


  49. - Oswego Willy - Tuesday, Nov 23, 21 @ 11:08 am:

    From above…

    ===At first blush, the state’s 4.95% flat income tax rate doesn’t seem that steep when compared to other states’ top tax rates. And that’s true if you’re talking about wealthy residents. But for middle-class taxpayers, the income tax rate is on the high end.===

    Reading that, I dunno what Kiplinger would say about the graduated income tax, and given other states, 5 of them, listed near or at the top have a graduated income tax…


  50. - Donnie Elgin - Tuesday, Nov 23, 21 @ 11:13 am:

    “ but I’m not seeing living in Wyoming or North Dakota being a great option for me…good hospitals in Alaska if I get sick? “

    Sort of cherry-picking from amongst The “Most Tax-Friendly states”, the list includes many states with good cultural/entertainment/healthcare options – among them are TN, FL, AZ, CA, WA – interesting that those are states that are leading destinations for Illinois outmigration

    “The most popular states where Illinois residents moved to in 2020 included Florida, Texas, California, Arizona, Washington, and North Carolina. United Van Lines said most other Midwestern states are “balanced” states, meaning they typically have a more equal number of people moving in and out.Jan 7, 2021”


  51. - thechampaignlife - Tuesday, Nov 23, 21 @ 11:15 am:

    ===I dunno what Kiplinger would say about the graduated income tax===

    I think his point is that the income tax burden for the theoretical middle class household that they used would have been essentially unchanged, because the Fair Tax would have only decreased the rate by 0.05 points for them. And the property taxes would not have had enough time to decrease because of the year or two lag between assessments and payment.


  52. - Oswego Willy - Tuesday, Nov 23, 21 @ 11:16 am:

    ===have only decreased===

    Isn’t that relief?

    :)


  53. - AD - Tuesday, Nov 23, 21 @ 11:16 am:

    === Do you want solutions or do you want blame?

    Those who continually look back for solutions never find a solution for a tomorrow but merely scapegoats for today===

    Don’t you still blame Rauner as a scapegoat daily almost three years after he left the State?


  54. - Bruce( no not him) - Tuesday, Nov 23, 21 @ 11:18 am:

    ===People generally believe they’ll see an income tax hike and never see the property tax reduction.==
    Count me as one of the people that believe this.
    Illinois has a trust problem as much as a tax problem. Alot of folks didn’t (and don’t) trust the 2 things will both happen.


  55. - Rich Miller - Tuesday, Nov 23, 21 @ 11:19 am:

    ===Don’t you still blame Rauner as a scapegoat daily almost three years===

    The extensive damage has not yet been fixed. Deal with it.


  56. - Oswego Willy - Tuesday, Nov 23, 21 @ 11:19 am:

    === the income tax burden for the theoretical middle class household that they used would have been essentially unchanged===

    “Essentially” is going a lot of work here.

    Instead of thinking, Kiplinger writes;

    ===At first blush, the state’s 4.95% flat income tax rate doesn’t seem that steep when compared to other states’ top tax rates. And that’s true if you’re talking about wealthy residents. But for middle-class taxpayers, the income tax rate is on the high end.===

    The context of a flat tax, he writes, the middle class burden is…

    Not much to interpret there, and I dunno, with context to its passage, how his opinion would change, but it’s an interesting note that Kiplinger puts it in context, squarely, in the flat tax and that burden.


  57. - Oswego Willy - Tuesday, Nov 23, 21 @ 11:22 am:

    ===Don’t you still blame Rauner as a scapegoat daily===

    Have you also forgotten I blamed him daily, in real time, when damage was occurring in front of our eyes?

    As Rich points out, that damage today, even by the members of the GA who aided and abetted, exists as the solution Rauner wanted, didn’t get, and then purposely hurt Illinois… this state has not recovered from purposeful hurt.


  58. - Lucky Pierre - Tuesday, Nov 23, 21 @ 11:49 am:

    The decline of the state of Illinois finances and lagging population growth started in 2001when Democrats took over total control of state Government.

    That damage has not been fixed


  59. - DuPage Moderate - Tuesday, Nov 23, 21 @ 11:55 am:

    - As Rich points out, that damage today, even by the members of the GA who aided and abetted, exists as the solution Rauner wanted, didn’t get, and then purposely hurt Illinois… this state has not recovered from purposeful hurt. -

    The same can be said for taxes, and pensions…and thus, trust. Can’t have it one way.


  60. - muon - Tuesday, Nov 23, 21 @ 11:57 am:

    I didn’t read the Kiplingler list as a matter of opinion once they established their hypothetical family and the tax components they would use. The rankings were just plugging in the numbers after that.

    Based on their hypothetical family and the three tax components, Illinois would be at the same place on the list today even had the progressive tax passed. At best they would have added a line noting that the property taxes could be trending down in the coming years, but they wouldn’t have any hard numbers yet.


  61. - anon2 - Tuesday, Nov 23, 21 @ 11:57 am:

    The sales tax is high because it is narrow, excluding most services, unlike most states. Someday the state could lower the rate but expand the base to cover the growing part of a service economy.


  62. - Oswego Willy - Tuesday, Nov 23, 21 @ 12:00 pm:

    ===pensions===

    What would you do about those pensions, that can pass, and be constitutional?

    Like I said, complaining and looking back…

    ILSC has already made clear the pension path(s)

    ===thus, trust.===

    Griffin, dishonestly but very effectively, made the point of the Frerichs Tax, taxing retirement income as a next logical step, yet I can’t seem to find anyone but Mike Frerichs standing tall to taxing retirement income.

    Your trust plank is predicated on a falsehood of a 60/71, 30/36, and a governor wanting to vote to tamp on the third rail of income taxes.

    But…


  63. - Oswego Willy - Tuesday, Nov 23, 21 @ 12:02 pm:

    ===At best they would have added a line noting that the property taxes could be trending down in the coming years, but they wouldn’t have any hard numbers yet.===

    But that would mean that the fair tax helped (possibly) in Illinois’ tax burden… and not hurt the tax burden.

    Correct?


  64. - Rich Miller - Tuesday, Nov 23, 21 @ 12:07 pm:

    ===started in 2001===

    George Ryan left office in 2003.


  65. - Oswego Willy - Tuesday, Nov 23, 21 @ 12:08 pm:

    ===in 2001===

    I guess 9/11 had no impact? In Illinois? Nationally?

    Time for another reboot.


  66. - thechampaignlife - Tuesday, Nov 23, 21 @ 12:22 pm:

    ===But that would mean that the fair tax helped (possibly) in Illinois’ tax burden… and not hurt the tax burden.

    Correct?===

    Correct. It would have eased our tax burden by about 1/3 of 1%. Not likely enough to change our position on the list, but it is not nothing. I am all for a progressive tax, and I voted for the Fair Tax. I am not trying to suggest that it would have been harmful, just that this particular study in this particular calendar year would not have been substantially different either way. We desperately need tax reform, and the Fair Tax would have put on on a path that might have made that a bit easier.


  67. - Lucky Pierre - Tuesday, Nov 23, 21 @ 12:35 pm:

    The nation’s longest post war economic expansion (10 years) ended in March of 2021 and recession started, a full 5 months before 9/11.

    That was the last year we had a balanced state budget.

    The other 49 states have had much stronger recoveries than Illinois.

    Somehow only one 4 year term of divided state government gets the blame for the all of the dysfunction and bad policies that have stifled economic and population growth.

    https://www.bls.gov/opub/mlr/2002/02/art1full.pdf


  68. - JS Mill - Tuesday, Nov 23, 21 @ 12:38 pm:

    =Edgar trusted the schools and local governments to cut their property taxes a significant amount. They proved to be untrustworthy.=

    NO, schools knew/know that the state is unreliable and that every election brings the risk of revenue loss and steep pain for schools. If the reduction of property tax is voluntary, it would be years before districts would reduce the rates/amounts.

    Take a look at PTELL and the impact that it had on tax Levy’s. Most people do not understand how it works, and schools in fast growing areas lot out on needed revenue. Most never dropped their tax rates because of the legit fear of what would happen.

    Too much to explain here, but schools have experienced inconsistent state revenue and do so even now. Transportation funding, important to large geographic and rural districts has not returned to 100% of entitlement since 2010 or 2011. During the Rauneer years we were down to 25%. Hard to cover costs of a mandate when you get so little.


  69. - Oswego Willy - Tuesday, Nov 23, 21 @ 12:38 pm:

    - thechampaignlife -

    It’s all good, and I think as well a discussion to these ends, and even where Illinois has failed and where she can find success, list or no list, change to how the burden of the people must include real reforms to lead to real numbers.

    If it were easy, the easy would’ve already been done. That easily said, the hard part to property taxes is K-12 education, the hard part to income tax is in which how that tax is burdened (higher, fair, cuts, or revamp) and how it might need to be allocated in budgets going forward, less the pension debt, less the required (statute or “other” givens).

    Still, I dunno how Kiplinger would be responded had the Fair Tax passed. It did not. So here we are. Thinking the Fair Tax wouldn’t help in any term is merely a partisan plank.

    Hope you’re well.


  70. - Streamwood Retiree - Tuesday, Nov 23, 21 @ 12:45 pm:

    ==From the Census QuickFacts for Illinois: Median value of owner-occupied housing units, 2015-2019 = $194,500==
    Housing units includes condos, duplexes and quads.
    Just post a link to a housing development with single family houses significantly under half a million in DuPage, Kane or Western Cook.
    I was looking two years ago and couldn’t find one.


  71. - City Zen - Tuesday, Nov 23, 21 @ 1:00 pm:

    Even with retirement income fully exempt from taxation, Illinois still ranks as a least tax-friendly state for retirees.

    http://my.kiplinger.com/kiplinger-tools/retirement/t055-s001-state-by-state-guide-to-taxes-on-retirees/index.php?map=&state_id=14&state=Illinois


  72. - Rich Miller - Tuesday, Nov 23, 21 @ 1:02 pm:

    ===Somehow only one 4 year term of divided state government gets the blame===

    He took a horrible situation and turned it into a complete disaster. That’s why. Really tired of this argument. He failed. Miserably and utterly. And he took his own state down with him.


  73. - Rich Miller - Tuesday, Nov 23, 21 @ 1:04 pm:

    ===gets the blame for the all of the dysfunction and bad policies===

    Don’t argue like a child.

    The real problem was we had three incendiary populist governors in a row. Populism sounds nice, the press eats it up because conflict drives coverage, but you cannot effectively govern as a populist. Or, at least the three I’ve seen close up couldn’t.


  74. - Lucky Pierre - Tuesday, Nov 23, 21 @ 1:31 pm:

    How effectively did the Democratic legislature that passed all of those unbalanced budgets, job killing laws and regulations, and looked the other way on a corrupt Speaker and leader of their party work to fix a bad situation?

    I recall zero compromise during the Rauner years.


  75. - Rich Miller - Tuesday, Nov 23, 21 @ 1:33 pm:

    ===I recall zero compromise during the Rauner years===

    There was plenty of compromise with those who wanted to work together. That 2017 tax hike and accompanying budget didn’t just come outta nowhere.


  76. - Oswego Willy - Tuesday, Nov 23, 21 @ 1:42 pm:

    ===compromise===

    At one point, one suggested leverage was to free social services, Democrats would need to hurt organized labor so Democrats could raise taxes.

    It’s as though you are clueless to where the Dems could see this as a win-win.


  77. - Anonymous - Tuesday, Nov 23, 21 @ 1:46 pm:

    Where did Democrats compromise during the Rauner years?

    The Speaker passed a budget 7 billion out of balance left town and refused to even consider a Democratic plan to reform pensions that passed the Senate


  78. - City Zen - Tuesday, Nov 23, 21 @ 2:20 pm:

    ==Thinking the Fair Tax wouldn’t help in any term is merely a partisan plank==

    It’s not a partisan plank, it’s math. The Kiplinger study focuses on a hypothetical $77,000 family. That family’s effective income tax rate under the fair tax would have been 4.88%. Income tax is a small fraction of that overall tax burden in Kiplinger’s calculation. Such a small improvement in a small portion of a robust calculation isn’t going to move the needle much.

    You keep referencing Kiplinger’s comment on the 4.95% rate: “…But for middle-class taxpayers, the income tax rate is on the high end.” What makes you think replacing 4.95% with 4.88% would be a large enough improvement that would improve our ranking? The math says otherwise. Fair tax or no fair tax, we’d be ranked the worst.


  79. - duck duck goose - Tuesday, Nov 23, 21 @ 2:25 pm:

    So much of this depends on what gets counted. For instance, when I lived in Washington State, there was no state income tax, but vehicle registration fees were shockingly high. In Illinois, we might have a highish sales-tax rate, but it’s only on tangible property, not on services. Also, in Illinois, we don’t have a property tax on personal property like many states do.

    It would be more interesting to see a comparison of budgets. If the State and local budgets are comparable to similarly situated state and local governments, then its just a matter of the governments pulling the same amount of money from different buckets.


  80. - DuPage - Tuesday, Nov 23, 21 @ 2:58 pm:

    ===Also, in Illinois, we don’t have a property tax on personal property like many states do.===

    I’m old enough to remember when Illinois did have a personal property tax. It permitted counties to enact and collect a tax on items like cars and boats, or business equiptment. Most counties did not collect it, although DuPage county did. Part of the political dealings with the new state constitution and income tax was the personal property tax was abolished. We were also told that the state income tax would not go higher then 2%.


  81. - DuPage - Tuesday, Nov 23, 21 @ 3:35 pm:

    One reason we have many good school districts in the collar counties is we have passed referendom after referendom to raise our own tax levy to pay for new schools and school programs, teacher’s pay, books, science labs, new roofs, remodeling, and air conditioning for the older schools, etc, etc.. The higher local property taxes were raised, the state aid formula somehow went down.
    When Edger proposed the higher income tax to give to local schools and local governments, they were all for it. The theory was the tax burden would go more to income tax and less on property tax. It was a theory that failed to materialize.


  82. - DuPage - Tuesday, Nov 23, 21 @ 3:47 pm:

    === Sure, tax rates in IL are higher but I’m not seeing living in Wyoming or North Dakota being a great option for me.===
    Wyoming and North Dakota are aflote in money from severance taxes they collected on coal, oil, and natural gas. This is dropping now, but they have enough money in reserve to run the states for years. That is one of the main reasons they don’t need a state income tax.


  83. - Anonymous - Tuesday, Nov 23, 21 @ 5:05 pm:

    DuPage has a faulty memory. DuPage seems to be operating under the impression that the Edgar tax swap proposal was adopted. It did not pass. It is true that Edgar proposed an increase in income taxes with a required drop in property taxes, but the State Senate never voted on the bill; so there was never a swap. The idea that “Edgar trusted schools and local governments” is entirely wrong. The bill did not pass; had it passed, property tax cuts were mandated as part of the legislation.

    Most importantly, left out of this discussion is the historic property tax cap law of 1991, which Edgar championed and passed. Tax caps dramatically slowed the outrageous property tax hikes occurring, particularly in the suburbs where double digit increases in property values were automatically handing taxing districts double digit increases in revenue - without requiring voter approval. Caps weren’t perfect but they stopped the unfair double digit increases, slowed overall property tax collections, saved homeowners billions of dollars and forced taxing districts to seek voter approval in order to access more funds. The 1991 tax cap law still stands as the greatest taxpayer savings in the history of the state.


  84. - Anonymous - Tuesday, Nov 23, 21 @ 5:33 pm:

    As State of IL retirees that are tier 1, gradually die off over time, the pension burden for IL taxpayers will greatly diminish. That will eventually allow the tax burden to diminish for all of us.


  85. - Morris resident - Tuesday, Nov 23, 21 @ 5:35 pm:

    Maybe a little misleading because I would like to see income also weighed in. How many more people are in the $77000 range in Illinois than would be in other states. Examples would be trade unions, police and fire, teachers, and other middle class families.


  86. - DuPage - Tuesday, Nov 23, 21 @ 5:55 pm:

    - Anonymous - Tuesday, Nov 23, 21 @ 5:05 pm:

    ===DuPage has a faulty memory. DuPage seems to be operating under the impression that the Edgar tax swap proposal was adopted. It did not pass. It is true that Edgar proposed an increase in income taxes with a required drop in property taxes, but the State Senate never voted on the bill; so there was never a swap. The idea that “Edgar trusted schools and local governments” is entirely wrong. The bill did not pass; had it passed, property tax cuts were mandated as part of the legislation.===

    Exactly the point, he went ahead with the income tax increase, and went on TV and said it would enable the schools and local governments to lower their property taxes, voluntarily. I didn’t remember about a law requiring them to lower their rates. If the law required them to lower their rates, they would have had to do it.
    The tax cap law was and is a good law, but serious problems with assessments still exist.


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