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Illinois House Approves Historic 32% Tax Increase

GOLDZILLA

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#1
With Illinois, which on Saturday morning entered its third fiscal year without a budget, facing a catastrophic downgrade, late on Sunday evening the Illinois House approved the most controversial element of a budget package, a tax hike which will increase the income tax rate by 32% from 3.75% to 4.95%, and the corporate income tax rate from 5.25% to 7%, to try and end a historic budget impasse. The bill passed 72-45. The House also approved a $36 billion spending plan minutes later on a 81-34 vote. According to the Sun Times, it cleared an initial hurdle on Friday with 23 Republicans voting “yes.”

“While no one could say this was an easy decision, it was the right decision,” House Speaker Mike Madigan said after the spending bill vote. “There is more work to be done.” Dems said they would work with Republicans on other resolution of other issues on table.

The proposed tax increase will now head back to the Illinois Senate, which approved a revenue bill on May 23 with all Democratic votes as part of its “grand bargain” package. But Governor Bruce Rauner has said he’ll only support an income tax hike if it’s limited to four years and paired with a four-year property tax freeze. He’s also still seeking changes in workers’ compensation and pensions.

Commenting on the just passed House bill, Rauner said he’ll veto the revenue bill.

I will veto Mike Madigan’s permanent 32% tax hike. Illinois families don’t deserve to have more of the hard-earned money taken from them when the legislature has done little to restore confidence in government or grow jobs,” Rauner said.

“Illinois families deserve more jobs, property tax relief and term limits. But tonight they got more of the same." He also said in an emailed statement that “if the legislature is willing to pass the largest tax hike in state history with no reforms, then we must engage citizens and redouble our efforts to change the state."

Some commentators promptly countered that Rauner's veto will likely be overriden.

The tax bill passed with some essential Republican support: it needed 71 votes. But Illinois House Republican Leader Jim Durkin questioned how it will address the state’s $14 billion backlog. Durkin is seeking to get Rauner the “balanced budget package,” he wants, which includes spending reductions and “meaningful reforms.”



“I am disappointed that we’re taking this up at this moment when there has been significant, significant progress to address the priorities of the governor and also the priorities of this caucus,” Durkin said.



There are, of course, political ramifications to supporting a tax hike, on both sides of the aisle. Some House Democrats were expected to vote no to try to shield themselves from Illinois Republican Party attacks in next year’s election. But some House Republicans, knowing they’d too be targeted for supporting it. said there’s no other choice.

Others were even more fatalistic: “If I lose my seat so be it,” state Rep. Michael Unes, R-Pekin said, adding the state shouldn’t have gotten so close to a financial collapse. “Without this, we will lose thousands of lives and thousands of jobs and the alternative is so much worse. I don’t like this. This is not easy. This is really, really difficult,” Unes said. “But the alternative is much worse than this. The alternative is literally taking our state off the cliff.”

David Harris was among the Republicans who supported the bill, while also urging the governor to sign the revenue and spending bills if passed: “Have the courage to do what is right and bring this madness to an end.”

“I was not elected as a state legislator to help preside over the financial destruction of this great state,” Harris said. “I respect my colleagues who are voting no. But to me, enough is enough.”

Meanwhile, changes made by House Democrats from the original Senate bill include the removal of streaming and satellite fees. It also closed corporate tax loopholes, increased the earned income tax credit, and restored the research and development and manufacturers’ tax credit to attract more businesses.



House Democrats filed amendments to both the tax and spending measures on Sunday, which included nearly $400 million more in cuts. Although some House Republicans voiced frustrations over changes, House Democrats said they were reflective of topics discussed during negotiations.

It is unclear if the passed tax increase will be sufficient to placate S&P. Recall July 1 was the date when the credit agencies said they would drop the state to “junk” status without a budget. Ultimately, the fate of Illinois' credit rating is now in the hands of Rauner, and whether and how fast his imminent veto is overriden.

Ultimately, Illinois faces a lose-lose dilemma: get junked and see its funding costs soar, or save its lowest possible investment grade rating, and watch as what is already the worst metropolitan exodus (recently the population of Chicago shrank the most of any US city), go into overdrive as tens of thousands more scramble to escape the state's soaring tax rates.
 

Goldhedge

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#2
32% sounds so much bigger than it really is...
 

Buck

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#3
Net Increase is only 1.2% personal, 1.75% corporate
Why are they choosing to use the 32% increase number?

Some shit is at play and we're witnessing it
 

OverOver

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#4
I want the Governor of Illinois to do something entertaining. Right now Illinois is the
frontrunner for the fiscal disaster plaque that has infected all the states. He can
literally take the national center stage with some bold action. Governor Rauner needs
to sign these tax increases immediately. Then with a press conference, step up to the mic
wearing flip flops, swimsuit, too large sunglasses, with a stupid looking hat and announce:

"Today the great state of Illinois will stand in front of all the other great states of this great
nation and show them what not to do. Besides that, fuk it, I'm joining Christie at the beach."
 

latemetal

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#5
^^^Bring me my harpoon, I have a months worth of blubber in sight.^^^
 

edsl48

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#6
And two local Illinois newspapers totally ignore the issue by not printing anything about this significant tax hike that also includes sales tax hikes. Typical of the Illinois population who can not be bothered with things like taxes in their how much down and how much a month mentality lifestyle.
 

90%RealMoney

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#7
Here in Commiefornia, new taxes went into effect on July 1st. Tobacco tax got raised again, about another buck a pack for cigs and cigars even. Gas tax increased, and will increase by more in November, along with DMV fees going up by a hundred bucks a year. Now we find out that after using these taxes to fix roads and other infrastructure (which are already funded by "Other" taxes) any remaining funds will go towards Jerry Brown's Train to Nowhere! You can't make this shit up. This Fucker found a way to get Taxpayers to pay for his "Privately funded Railway". This is no different than a new Football stadium, only 100 times more expensive!
 

Professur

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#10
Well, this only applies to people who actually pay taxes ... and none of them are voting Democrat anyhow.
 

nickndfl

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#11
What about offsetting spending cuts like 5-to-1 for every tax increase?
 

Irons

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#13
The angry rude inbred pieces of shit are already flooding into my state. This is only going to make it worse.

.
 

Alton

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#17
The angry rude inbred pieces of shit are already flooding into my state. This is only going to make it worse.

.
Angry rude inbred POS flood into your state EVERY summer and twice as many on weekends! Embrace the chaos while y'all are embracing those dollars!
 

Uglytruth

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#18
Why are they choosing to use the 32% increase number?
From 9% total to 11.95 total is almost 1/3 or 33% increase.......... did they really fool ya?
 

Buck

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#19
From 9% total to 11.95 total is almost 1/3 or 33% increase.......... did they really fool ya?
No, more like I was just pointing out how statistics and percentages can be used to paint nearly any picture you want

Why would anyone want to paint a worse picture?

In this case, what does, or maybe, who does it best serve?
 

Buck

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#21
Precisely!

Fear is one reason, I suspect, but overall, it only serves to make themselves look even more incompetent
 

solarion

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#22
But some House Republicans, knowing they’d too be targeted for supporting it. said there’s no other choice.
Sure there is. Spend less than you steal.

Bunch of cowards.
 

solarion

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#24
I sure ain't expecting anything dramatic here...like honest goobermint, but you'd think these parasites would know when they're killing their host. Most of the worthwhile people already fled Chicago, now this silliness will continue that trend and spread it across the failed state. These bloodsuckers don't even know when to take a break to preserve themselves.
 

Cigarlover

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#26
They did reduce spending by 400 million though. 15 billion behind on their bills and they cant find any waste in Gov?

This is why the Gov never had the power to directly tax your pay. Not until 1913 anyway. Well actually it was later than that, whenever the new deal went into effect.
 

Treasure Searcher

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#29
The biggest suckers are the citizens of IL. I don't blame the criminal politicians as much as I blame those who enable them!
Problem is, anyone benefiting from this taxation, debt and spend scheme are going to try to keep it running as long as possible.

Any sane person would sell off any nonmovable property, take their assets and flee to another state. Sticking around will only make you pay for the fiscal disaster.

As the saying goes: who benefits? Whenever some type of scam is going on, just look at who benefits to see who wants to keep the scheme going.
 

nickndfl

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#30
Problem is, anyone benefiting from this taxation, debt and spend scheme are going to try to keep it running as long as possible.

Any sane person would sell off any nonmovable property, take their assets and flee to another state. Sticking around will only make you pay for the fiscal disaster.

As the saying goes: who benefits? Whenever some type of scam is going on, just look at who benefits to see who wants to keep the scheme going.
Remember almost half the people in the USA do not pay income taxes. I can only imagine the % is higher in IL. Of course they don't care and just want the spigot of free stuff wide open without regard to the economic feasibility. They have nothing vested which is why tax credits are better than handouts. Tax credits benefit those who contribute to society rather than those who have made a culture out of getting everything for free.
 

ttazzman

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#31
corp income tax rate up to 7%...hell they have 93% more to go..(minus of course what the feds take)....:) ...of course corp income tax is double taxation ...but who cares anyway ...
 

Aurumag

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#32
The biggest suckers are the citizens of IL. I don't blame the criminal politicians as much as I blame those who enable them!
In defense of the citizenry:

As a 5th generation native and victim of California politics, it can be quite comfortable being slowly cooked.
 

Mujahideen

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#33
32% sounds so much bigger than it really is...
Net Increase is only 1.2% personal, 1.75% corporate
Why are they choosing to use the 32% increase number?

Some shit is at play and we're witnessing it
No, more like I was just pointing out how statistics and percentages can be used to paint nearly any picture you want

Why would anyone want to paint a worse picture?

In this case, what does, or maybe, who does it best serve?
Well, this is math. Math doesn't usually lie.

If someone payed 1k in state taxes before, then they will pay 1.32k in taxes now.
 

Buck

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#34
Actually, there's math
and there's statistical math

Both are based upon numbers and both prove truths but only one is based upon an outcome philosophy
the other is just math
 

Mujahideen

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#35
Someone could say something like there are more guns ever than before in America and crime is on a downward trend...

Or fewer homes in America have guns and crime is on a downward trend.

Both are true.
 

Buck

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#36
So, what do you want to sell?

Maybe, like some have chosen to do, what they're selling isn't something that's really good for any of us, like cigarettes.

That changes the entire computation but only with regards to spin which really isn't math but can be supported by math depending on how you spin the results towards the outcome that's expected

I've heard these techniques work well until a court requests to see the data used in the computation
then, quick, change the subject


"Hey, who left a window open, its getting cold in here!"



:2 thumbs up:
 

southfork

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#37
Insanity is doing the same thing over and over and expecting a different resut, they keep voting in tax and spend dems, taxes will go up and up, look at CA, the ashats voted in Brown after destroyed the state years ago in two terms, what is wrong with peoples thinking. Bush while gov of fl raised state budget over 50% in 8 years, no way I voted to elect his president
 

Ensoniq

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#39
Funny even with the enormous tax increase they still have a 2 billion budget shortfall not to mention the debt and interest on it

It's too deep to climb out from - they are only biding time

When the music stops don't be the one with no chair.

In NC we've had our rates reduced from 7.75 to 5.75 in the last few years
 

edsl48

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#40
Funny even with the enormous tax increase they still have a 2 billion budget shortfall not to mention the debt and interest on it

It's too deep to climb out from - they are only biding time

When the music stops don't be the one with no chair.

In NC we've had our rates reduced from 7.75 to 5.75 in the last few years
Missouri, the neighboring state if one lives in the St. Louis Metro area, got a state levied tax cut last week.