“Mayors slam Pritzker’s proposal to eliminate grocery tax,” was the Daily Herald’s headline above a story last week about several mayors of upper-income suburban communities complaining about a proposed tax cut.
I don’t know if the mayors quite understand this, but headlines like that are basically an in-kind campaign contribution to the governor and the Democratic super majority. The fact that Rep. Marty McLaughlin (R-Barrington Hills) was the center of that press conference arguing against a tax cut, even though he will face a hard-charging Tier One opponent this fall just makes it even weirder. McLaughlin walked it back later in the week, but the damage was done.
This grocery tax elimination proposal is a pretty darned solid play by Gov. Pritzker on multiple political and legislative levels. Whether it’ll become an actual law is, at this early stage, almost beside the point. And whether it’s wise is quite another story.
The “best” part is that this is a state tax cut that doesn’t cost the state budget a dime. You just can’t ask for more than that in this business. The money raised by the tax is collected by the state and then distributed to local governments.
It’s also a regressive tax, which hurts people at the lower rungs of the income ladder. As one top Senate Democrat told me recently, eliminating a regressive tax allows the governor and the General Assembly’s Democrats an opportunity to play the good guys for a change.
The proposal has divided the Republican party, which has to delight the Democrats. On the one hand, you had people like Rep. McLaughlin, providing fodder for whoever writes the direct mail in his opponent’s campaign. On the other hand, you have Rep. Blaine Wilhour (R-Beecher City), who is facing a primary challenge and knows better than to oppose a tax cut. Rep. Wilhour said this to his local newspaper: “The penny tax on groceries is punitive for working families, and we should end it in Illinois.” Smart dude.
The tax cut is easy to explain and is therefore receiving a lot of news media coverage. Everybody in politics loves issues like this, even if they’re not all what they seem to be. A bipartisan tax cut that also puts some Republicans in a trick bag, including some politically vulnerable members? Sure, sign me up.
And the more attention this $325 million tax cut receives, the less time reporters will have to flesh out the governor’s fast move on the income tax. Instead of allowing the standard income tax exemption to rise to its previously inflation-tied statutory levels after freezing it for a year, the governor proposed saving the budget some money by not giving people their fully entitled exemption this year. That technically qualifies as a tax hike, but is not so easy to explain.
The Illinois Municipal League was all set to play some big splashy offense this year by again pushing to raise the percentage local governments receive from state income tax collections. But, for now at least, the IML is forced to play defense against a popular idea. The governor and some Democrats have pointed out that the legislature could give local governments the ability to impose their own grocery taxes, which the mayors definitely do not want to deal with (they’d much rather the state impose a regressive tax than them). So, convincing the Democrats to drop the idea could mean the IML might have to withdraw its own proposal, or something in between.
The grocery tax elimination also whacks the City of Chicago’s budget by $60-80 million, according to the city’s estimates. Remember how Mayor Brandon Johnson reneged on his pledge last month to partner with the state and Cook County to provide $70 million in funding to maintain migrant services? At the very least, this Pritzker proposal puts the rookie mayor on notice that there are multiple strings which can be pulled on him.
In the end, I’m not certain this will actually pass, but it’ll be fun to watch for a while anyway. Few legislators care about Barrington’s budget, but they do care about the burden this could put on poorer communities and on Chicago. Not to mention that narrowing our tax base is a huge mistake this state has repeatedly made for generations.
However, I also don’t get the impression that Democrats are in much of a hurry to resolve the issue because they can continue soaking up the publicity, courtesy of the mayors and some Republicans.
- Rabid - Monday, Mar 11, 24 @ 7:35 am:
Just setting the stage for mayors to get on board with the new millionaire tax for them
- Skeptic - Monday, Mar 11, 24 @ 7:39 am:
“The proposal has divided the Republican party” Given their dysfunction in general, that doesn’t seem to be much of a stretch
- Red headed step child - Monday, Mar 11, 24 @ 8:35 am:
Granted it its a ” tax,cyt” its not the substantial tax,cut Illinois resident seek.what does the average family save a year on that? Nothing that amounts to any life changing $
- Frida's boss - Monday, Mar 11, 24 @ 8:36 am:
If you want to know who the smartest elected officials are in Illinois, just ask IML they’ll tell you if the state ran like municipalities the state would be in much better shape.
Well played by the Governor and team. They could go one step further and remove the municipal portion of the income tax and allow locals to put their own in place.
- Anyone Remember - Monday, Mar 11, 24 @ 9:11 am:
“… remove the municipal portion of the income tax and allow locals to put their own in place.”
The Constitution of 1970 had local taxes shares set (except for home rule) and collected by the State. Apparently to avoid local property taxes on vehicles (my child’s BFF found out about that nasty little surprise after moving to MO). The Governor’s proposal, which I support, is a step away from that position.
- Flyin'Elvis'-Utah Chapter - Monday, Mar 11, 24 @ 9:17 am:
What this proposal has done has, again, exposed Republican hypocrisy. Keep arguing against cutting a tax on something everyone needs.
There just aren’t that many people who have any business getting into a battle of wits with Pritzker.
…and they sure aren’t in the ILGOP.
- GoneFishing - Monday, Mar 11, 24 @ 9:35 am:
I don’t think the state should be collecting taxes for local governments. If they want it they should go to the voters and ask and explain why they need it. Local governments were opposed to a graduated income tax. That extra money they were going to get goes away and then they complain.
- sulla - Monday, Mar 11, 24 @ 9:39 am:
“Well played by the Governor and team.”
Is it though? Did the governor really need to pick a fight with mayors and municipalities in order to score a cheap political win for his progressive wing?
From my vantage point, voters have been pretty quiet about the elimination of this largely-ignored tax. But I am definitely hearing that municipal officials are seething over this move.
So my question is this: Does the Governor’s political gain with Progressives offset having a thousand elected officials and municipal staff persons ticked off at him?
And don’t think for a second that when your local municipality needs to cut something like park funding in order to balance their budget, that your local leaders won’t rightly point a finger straight to Springfield. Pritzker is going to get dragged in every city council meeting statewide over this move.
- Annonin' - Monday, Mar 11, 24 @ 9:49 am:
It also amusing the 9 of 10 Illinoisans dont know there is no sales on food and meds…and of course retailers will not cut prices if the 1% does go away.
How about those Bears?
- TheInvisibleMan - Monday, Mar 11, 24 @ 9:53 am:
“its not the substantial tax,cut”
It’s amazing how every single tax cut is small and insignificant, but any tax or fee increase of identical or similar size will cause a mass exodus out of Illinois.
If this cut by the state is so insignificant, then the mayors shouldn’t have any problem shifting the exact same tax amount to fall under a local ordinance. No additional tax amount would be created in those places who keep it in place, just a bookkeeping change.
And yet, the opposition exists.
There’s no way to logically oppose the governors proposal. But that isn’t going to stop some people from trying - and making fools of themselves.
- Ducky LaMoore - Monday, Mar 11, 24 @ 9:58 am:
This is obviously playing well, which I don’t really understand. It is about the most cowardly proposal a governor could make. And his bashing of local governments makes him look petty.
- Route 50 Corridor - Monday, Mar 11, 24 @ 12:06 pm:
==There’s no way to logically oppose the governors proposal. But that isn’t going to stop some people from trying - and making fools of themselves.==
The logical way to oppose it, until he made clear that municipalities could approve it themselves, is to say it blows up city budgets.
I am a fan of Pritzker, we haven’t had effective government in this state for a long time, until he came along.
This is going to hurt local government and their ability to do any number of vital services and that means cuts.
- TheInvisibleMan - Monday, Mar 11, 24 @ 12:06 pm:
“his bashing of local governments”
He’s not bashing them. They are bashing themselves. It’s amazing to watch, frankly.
- RATM - Monday, Mar 11, 24 @ 2:06 pm:
“Smart Dude”
has to be a first for everything
- Demoralized - Monday, Mar 11, 24 @ 2:08 pm:
==This is obviously playing well, which I don’t really understand.==
You don’t understand a tax cut on groceries playing well?
- Duck Duck Goose - Monday, Mar 11, 24 @ 2:35 pm:
This may be smart politics right up to the point where it actually happens.
The reason the state collects taxes is because its more efficient and better for the taxpayers to have a centralized collection system. It’s not because the state is doing a favor to the locals (the state makes locals pay it for collecting their sales taxes).
At some point, when locals begin their own collections, the public will recognize that this proposal sacrifices good policy for “good” politics.
- Dotnonymous x - Monday, Mar 11, 24 @ 2:52 pm:
- This is obviously playing well, which I don’t really understand.
Your tower is Ivory?
- Ducky LaMoore - Monday, Mar 11, 24 @ 4:28 pm:
“Your tower is Ivory?“
Huh? A 1% sales tax? Ivory tower? That is hilariously ridiculous. But whatever, I don’t care anymore. Municipalities will just raise property taxes to offset the loss almost without notice.
- Excitable Boy - Monday, Mar 11, 24 @ 9:59 pm:
- It is about the most cowardly proposal a governor could make. -
One could say the same thing about mayors letting the state collect a tax for them while decrying other tax proposals.