I am thankful to the Effingham Daily News editorial board for bringing up the proposed Constitutional amendment that will be on the ballot this November, even though I disagree with their conclusion. This is a vitally important topic that needs to be fully discussed so folks can have full understanding of what they are voting on.
If enacted, the proposal would change the Illinois income tax from the current flat tax approach to a graduated tax approach that is widely used by most other states as well as the federal government. In spite of what the critics say, the amendment does not change the ability of the General Assembly to raise or lower taxes. The vote needed to raise or lower the income tax would remain unchanged whether or not the measure passes.
In reading the EDN editorial, they cite several sources who are now arguing that the proposed amendment should be removed from the November ballot. Included in the list of opposing voices are the Illinois Policy Institute and former Republican gubernatorial candidate Bill Brady, each of whom opposed the proposal before the current economic conditions as well. So it shouldn’t surprise anyone that they are still opposing the amendment now.
What I think the article is missing are a couple key ideas. First, the proposed graduated tax rates would actually be a tax cut for the lower income wage earners in the state. Middle-income earners will pay the same percent they pay now. Only the top 3% of wage earners will see an increase. This runs counter to the comparison with the Great Depression era tax increases instituted by the federal government, not to mention that the scale of increase is not even close in comparison.
The second key point is somewhat alluded to by Jim Nowlan’s comments near the end of the editorial. The proposed change does not completely fix the budget hole. Nowlan notes that analysis says there would still be a budget hole after instituting a progressive tax. While that may or may not be true, the answer to addressing a budget hole would not be to take in even less revenue. Long trips begin with the first step and moving to a graduated tax is the first step in a long journey of recovery for the State of Illinois.
What the critics of the graduated tax as well as the writers of the editorial fail to mention is the cost of not acting. Again referring to the Nowlan numbers, it’s clear that Illinois has a budget shortfall. If the graduated tax is not passed, most analysts agree that there will almost certainly be an across the board tax hike on all Illinoisans – – middle class as well as upper class.
Middle class folks have taken hit after hit in recent decades while upper class folks have gotten richer and richer. For folks to vote down the graduated tax simply perpetuates that pattern. Furthermore, taking that approach is what would truly be a hurt on the economy. Tax increases on the middle class are like siphoning fuel from the gas tank of a car.
Moving to the graduated tax makes even more sense now than it did before the current economic crunch. Voters shouldn’t miss this opportunity to start moving Illinois in the right direction.