The pros and cons of Gov. J.B. Pritzker’s signature issue — a proposed graduated income tax — were discussed and dissected at length during a panel discussion in the west suburbs Tuesday evening.
On one hand, a tax increase on the wealthiest Illinois residents would make the state a less attractive place to do business that wouldn’t balance the state’s budget. On the other, the projected $3.6 billion in new tax revenue would be “a step in the right direction” that would make the state’s tax policy more equitable.
At a forum hosted by the Chicago Sun-Times and the Illinois AARP in Oak Park, Adam Schuster of the Illinois Policy Institute and Greg Baise of the Coalition for Jobs, Growth & Prosperity argued against the ballot measure. Bob Gallo of AARP Illinois and Ralph Martire of the Center for Tax and Budget Accountability, meanwhile, advocated for its passage.
Gallo, though he favors the tax, cautioned that the tax would not be a panacea for the state’s fiscal woes.
“This is not the perfect solution, but it’s a step in the right direction,” he said. “We didn’t get here overnight, and it’s not going to get fixed with just this.”
While campaigning for governor, Pritzker proposed the graduated income tax — a “fair tax,” as he calls it.
As it stands now, all income in Illinois is taxed at 4.95% on the state level. Changing the tax rate, though, would require an amendment to the state constitution. That amendment would require a 3/5 majority approval from voters in November 2020.
If approved, single filers earning between $250,000 and $350,000 and joint filers earning up to $500,000 would pay 7.75%. Single filers earning more than $750,000 and joint filers earning more than $1 million would be taxed at a rate of 7.99%.
