[The following is a paid advertisement.]

“The most important thing we are accomplishing is stabilizing the finances of the state,” Illinois Gov. J.B. Pritzker said at the March 7 press conference rolling out his proposal for a graduated income tax.

But Pritzker’s tax structure would actually make Illinois’ moving revenue target even harder to hit. If Illinois had adopted the governor’s progressive tax rates in 2007, income tax volatility would have been 30 percent higher. Larger swings in income tax revenue would make state finances less stable, harder to predict, and increase the likelihood and size of Illinois’ already chronic budget shortfalls.

Take the 2009 recession, for example. Illinois income tax revenues would have fallen by approximately $2.16 billion that year if Pritzker’s proposed income tax rates were in place – a 13 percent drop. But under the current flat income tax, revenue would have fallen by $1.55 billion – a 10 percent drop. That’s a $613 million larger swing in revenue in just one year.

Increasing the state’s reliance on corporate and progressive individual income taxes could lead to even larger budget shortfalls. And those budget shortfalls will require middle class tax hikes, because the middle class makes up a larger share of taxpayers and their incomes are more stable.

A spending cap, which already has bipartisan support in the General Assembly, would shore up state finances and prevent further shortfalls.