McLean County’s top Democrat and Republican are making their case for and against the graduated income tax—one of the biggest issues facing voters this fall.
Illinois voters are being asked whether they want to change the state’s income-tax structure from a flat-rate system to one that takes more from wealthier residents. Supporters promise that no one making less than $250,000 would pay more. That’s 97% of taxpayers. Wealthier taxpayers would pay up to a top rate of 7.99%.
It would generate $3.4 billion more a year in revenue.
“If we pass this Fair Tax amendment, we’re able to truly, truly invest more into social services and into our communities,” said Nikita Richards, chair of the McLean County Democratic Party. “Think about it: With a $3.4 billion projected increase in tax revenue for the state, that’s no drop in the bucket. That’s a huge amount of money. We can do a lot with that.”
The real danger, Richards said, is if voters reject the change. The Pritzker administration already has warned that across-the-board tax increases of 20% may be necessary.
“I’m hopeful, but I also have to be realistic about what could happen to Illinois residents and taxpayers if we don’t (approve this),” Richards said.
Opponents claim the graduated income tax plan will give lawmakers a “blank check” to increase spending without paying the state’s massive pile of debt. The state’s current $43 billion budget, passed in May, depends on about $6 billion in borrowing and other debt.
WGLT asked Richards why voters should trust Democrats on a tax proposal like this, given they’ve been the party in power as the state’s finances have deteriorated.
“Frankly, it’s because we have an administration under Gov. (JB) Pritzker that understands the importance of righting yesterday’s wrongs,” Richards said.
McLean County Republican Party chair Connie Beard is opposed to the change.
She said Illinois’ flat structure is one reason why lawmakers have historically been “very hesitant” to raise income taxes.
“They know that when they change it, they change it for everybody. It is, in that regard, more fair, because it has an across-the-board impact. That’s held legislators back from raising it in the past, to some degree,” Beard said.
As other critics have argued, Beard said she’s concerned the graduated income tax structure could hurt middle-income taxpayers at some unspecified point in the future. That would happen, she said, if lawmakers start moving around the tax brackets that determine what rate someone pays.
“They can turn to voters say, ‘Hey, we didn’t raise the tax rate.’ Well, that’s true. They didn’t change the tax rate. But they moved the tax brackets so that a different segment of our population now becomes part of one bracket that they were not part of when this was initially (passed).”
Richards said that’s a hypothetical. What is part of the plan, she said, is “the power of the legislator to right the wrongs of yesterday and lighten the burden on the middle class.”
“That allows them to have a fairer tax system, and it allows those higher earners in our state to pay their fair share,” she said.
Watch the full WGLT interview below:
https://www.youtube.com/watch?v=Y9puacOu-Dk
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