Illinois is a great place to live. To make it even better, Illinois needs a long-term solution to its fiscal problems. The state’s financial woes have hurt everyone but especially our most vulnerable: children, seniors, the sick and the poor. A progressive income tax offers an opportunity for the state to increase its income so that it can balance its budget, pay bills, and stop underfunding education and essential services.
A progressive tax is fair; under it, people who earn more money have higher tax rates. Illinois now taxes personal income at a flat rate of 4.95%. A flat rate structure results in those with lower incomes paying a higher portion of their income in taxes. The Institute on Taxation and Economic Policy calculates that in Illinois, an average middle-class family now pays more than 12% of its income in taxes; the poorest 20% pay 14.5%; and those in the top 1% pay 7.4% of their income in taxes. Is it more fair for the poor to pay a higher proportion of their income in taxes, or for the wealthy to pay a higher tax rate? In my view, it hurts the wealthy a lot less to contribute more.
The proposed Constitutional amendment simply deletes the requirement that income be taxed at a non-graduated rate. The proposed amendment says, “There may be one tax on the income of individuals and corporations. This may be a fair tax where lower rates apply to lower income levels and higher rates apply to higher income levels. …”
The Illinois Senate just passed a progressive tax bill that would go into effect after the Constitution is amended. Hence, we know what the new tax rates will be. The Senate Bill sets taxes for taxpayers with joint returns at 4.75% for incomes under $10,000; 4.9% for income $10,000-$100,000; 4.95% for income $100,000-$250,000; 7.75% for income $250,000-$500,000; 7.85% for income $500,000-$1,000,000; and 7.99% on income in excess of $1,000,000. This would lower income taxes for most people and would only raise taxes on those who earn more than $250,000 per year.
Amending the Illinois Constitution to allow for fair tax rates will not increase the likelihood of tax increases on the middle class. The legislature is well aware that the middle class encompasses the majority of voters. I doubt the wealthy have much to fear either, as they seem quite capable of taking care of their own interests. The most vulnerable are the poor and the amendment does not allow for higher rates for poorer people.
Let’s invest in Illinois to fund a solid education for all of our children and keep our kids in Illinois by returning our state universities to first class. Let’s fix our highways and provide social services to the needy. A fair tax can help Illinois be a better place for all of us to live, work, go to school, run a business and raise a family.
Jan Von Qualen has a small farm in Grundy County. She recently retired from the Illinois Commerce Commission, where she was an Administrative Law Judge. She is now a board member of the Faith Coalition for the Common Good in Springfield and is associated with Shay Law, Ltd., in Peoria.
Region: Springfield,Feeds,Opinion,Region: Central,City: Springfield
via Opinion – The State Journal-Register http://bit.ly/2EMjS6J
June 1, 2019 at 07:05PM