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Estimated $6 Billion Hit to Taxpayers Would Be Devastating With Economy in Shambles

CHICAGO – Proclamations that Illinois will stick taxpayers with a $6 billion income tax increase early next year show that Gov. Pat Quinn's administration is out of touch with how to get the state budget and the state's economy back on track, says the Illinois Policy Institute. Quinn’s budget director David Vaught was quoted in media reports Thursday as pledging that Illinois officials will pass a “substantial” 66 percent increase in the income tax in January, after the fall elections. Vaught said that the increase from 3 percent to 5 percent on individuals would bring in about $6 billion in new money next year.
What does $6 billion look like?

• It would take 100,000 Illinoisans making $60,000 a year to turn all of their salary over to the state in taxes each year to bring in $6 billion.
• Six million Illinoisans – nearly half the state's population – would have to pay $1,000 more each in state income taxes a year to generate $6 billion.
  

That $6 billion number is even more astonishing when compared to the state's economy. An Institute analysis of Bureau of Labor Statistics employment data from last year found more than 750 occupations in Illinois where the total annual income earned by everyone in that field doesn't reach $6 billion. That includes both blue-collar and white-collar jobs, as seen in these examples:

• Mental health and substance abuse social workers, making an average salary of $40,500, earned a total of $225.5 million
• School bus drivers, making about $28,000 annually, earned $505.3 million
• Police and sheriff's officers, earning $66,000 a year, collectively brought in $2.07 billion
• Lawyers, making about $137,000 annually on average, collected a little more than $4 billion
  

“The Quinn administration’s announcement of a massive tax increase is incredibly disheartening,” said John Tillman, CEO of the Illinois Policy Institute. “What more do hard-working Illinoisans have to do to make it clear tax increases are exactly the wrong way to get out of this mess? We will stand with taxpayers once again to turn down misguided policies like these and instead push for spending reform and a more manageable budget that has been long overdue from Springfield.”

The Illinois Policy Institute has long called for more accountable leadership from Springfield. “Taxing and spending will only dig our budget and economic holes deeper,” Tillman said, “and make the climb out of them that much steeper. This would be Quinn's third bite at the income tax increase apple, and each time taxpayers and lawmakers have spoken loud and clear to defeat it.” 

With unemployment high, businesses struggling under the weight of long delays in receiving payment from the state, and working families pinching every penny, the Institute says discipline and tough choices are needed at the state Capitol rather than increased taxes that punish taxpayers. 

Upon inquiries from the Institute, the Governor’s office declined to comment on its tax increase plan.