Illinois’ richest man kicked in $20 million to fight Gov. J.B. Pritzker’s proposed graduated income tax, setting the stage for a costly Election Day showdown on the ballot initiative.
It also puts two of Illinois’ richest men squarely on opposite sides of a battle to change the tax code to more heavily hit high-income earners.
As big as the eight-figure donation is from Ken Griffin, the founder and CEO of hedge fund Citadel, it’s a fraction of what Pritzker has already ponied up.
The Democratic governor has personally dropped $56.5 million of his fortune into the “Vote Yes for Fairness” committee, which is focused on getting the ballot initiative passed.
Griffin is worth an estimated $12.1 billion, according to Forbes’ latest ranking of the world’s billionaires. That makes him the state’s richest man. Pritzker ranks fourth in the state with a fortune estimated at $3.4 billion from his Hyatt Hotels holdings and his own private equity firm.
The Coalition to Stop the Proposed Tax Hike Amendment – the group that Griffin contributed to last week --- said they’re encouraged people are “responding positively to our message that this is the worst possible time to raise taxes.”
“The Coalition welcomes support from anyone who believes we must stop Springfield Politicians from having new power to increase income taxes on every group of taxpayers, whenever they want,” the group said in a statement.
But John Bouman, chairman of the “Vote Yes For Fair Tax” campaign, said Griffin’s donation helps “protect the broken status quo.”
“Griffin took home $1.5 billion in 2019 alone, yet paid the same state income tax rate as teachers, nurses, grocery store clerks and other essential workers,” Bouman’s statement continued. “That’s wrong and it’s exactly why Illinois needs the Fair Tax amendment.”
Quentin Fulks, who heads the “Yes For Fairness” committee Pritzker has donated to said in a statement “if Mr. Griffin would like to explain why he thinks it’s fair that he pays the same tax rate as our nurses and grocery store clerks, that’s a conversation we welcome having.”
Passing what he dubs the “Fair Tax” has been one of Pritzker’s top priorities since he took office last year. While the opponents argue the proposal opens the door for further tax hikes down the road to pay off the state’s massive debts, Pritzker portrays it as a way to get the rich — including himself — to pay their fair share.
Pritzker and his wife reported $5.5 million in taxable income for 2018. Trusts benefiting the Pritzkers paid $5.3 million in Illinois taxes at a rate of 6.45% and $29 million in federal taxes.
The first-term governor also donated a record-setting $171.5 million to his own gubernatorial campaign.
Pritzker’s donations to the committee are bankrolling the effort to get the initiative passed in November. Besides the $56. 5 million he’s donated, only $586.11 has been donated to that committee, largely from the financial services company Northern Trust.
That company is the one Pritzker selected to manage his personal assets when he placed his investments into a “blind trust” before taking office.
Bouman’s committee, the “Vote Yes for Fair Tax” group, also supports the proposed amendment. That committee has nearly $1.8 million in its coffers, state election records show.
Griffin’s donation follows unions, including SEIU Healthcare and the Chicago Federation of Labor, throwing their support behind the proposed amendment on Thursday. Both have an ownership stake in Sun-Times Media.
The AARP is also on board with the change in the state’s tax structure, launching ads last month supporting the proposed tax amendment that asked people “if you’re not a billionaire, why are you taxed like one?”
Business owners are largely behind the effort to stop the proposed change in the tax code.
Under the proposal, incomes between $250,000 and $500,000 would be taxed 7.75%. It would maintain the current tax rate of 4.95% on incomes between $100,000 and $250,000. Income from $500,000 to $1 million would be taxed 7.85%, while income over $1 million would be taxed 7.99%. For those earning incomes of $100,000 or less, the rate would dip down to 4.9%.
Voters are not deciding on the rates when they cast their ballot in November, however.
Should voters approve the constitutional amendment, the new tax rates would go into effect Jan. 1, 2021.
