High taxes vs. low taxes: Which states are winning the population war?

Illinois families say curbing high taxes is a top issue, and the state is losing loads of residents.

At a time when Illinoisans call high taxes a top concern, competing states are providing relief.

The Tax Foundation ranked Illinois 38th-worst in the country when looking at taxes including those on sales, property and business.

Despite its high tax burden, Illinois maintains a constitutionally protected flat income tax, which provides taxpayers stability and predictability. Illinois’ flat tax kept the state’s ranking from sinking lower in its ranking, the Tax Foundation said.

However, of the 15 states with a flat income tax, Illinois was not among the seven that reduced their rates from 2025 to 2026.

That leaves Illinois with one of the highest flat income tax rates in the nation at 4.95%. Six of the seven flat-tax states that did not cut rates already have lower rates than Illinois’. Georgia’s 4.99% is scheduled to decrease every year until it reaches 3.99% and next year will drop below Illinois’ rate.

Ohio recently moved from a graduated income tax to a flat tax.

In 2020 Illinois voters rejected a proposal for a progressive income tax. Even so, state lawmakers have continued exploring ways to move away from the flat tax, ignoring the will of voters.

In a recent poll by M3 Strategies for the Illinois Policy Institute, more than half of Illinois voters identified high taxes as one of the state’s top two issues, and 41% cited the economy.

Those concerns are translating into action: just over half of Illinoisans say they would leave the state if given the opportunity, and among those who would leave, nearly 69% cited high taxes as one of their top two reasons.

Many Illinoisans already have one foot out the door as state leaders continue to rack up taxes and increase economic strain on families and businesses. From July 1, 2024, to July 1, 2025, 40,000 residents left Illinois for other states.

Recent U.S. Census Bureau data also shows Illinois’ population under age 20 declined by nearly 7% from July 2020 to July 2025. Without a stable youth population, the outlook of the Illinois economy is growing bleak, especially considering its pension problem.

Gov. J.B. Pritzker signed a record-high $55.9 billion budget for fiscal 2027 that includes more than $800 million in new taxes on businesses such as social media companies and fantasy sports operators.

Illinoisans already face one of the highest state and local tax burdens in the nation, including the highest property taxes and eighth-highest sales taxes. In 2017 Illinois’ income tax endured the largest permanent hike in state history.

The 2027 state budget moves Illinois in the opposite direction of what residents say they want. If Pritzker and lawmakers want to reverse Illinois’ decline, they should start by spending less and listening to what voters are already telling them: high taxes and the economy are their top concerns.