No reason to celebrate Tax Day

The 67 percent tax hike on individuals and the 46 percent tax hike on corporations were supposed to pay down the state’s unpaid bills, but instead 80 cents out of every tax hike dollar went to fund state worker pensions in 2012.

Ted Dabrowski
Vice President of Policy

Today is Tax Day, a day everyone loves to hate.

In Illinois, this day is particularly painful because we’re still reeling from the state income tax hikes of 2011.

The 67 percent tax hike on individuals and the 46 percent tax hike on corporations were supposed to pay down the state’s unpaid bills, but instead 80 cents out of every tax hike dollar went to fund state worker pensions in 2012.

And the state still has nearly $10 billion in unpaid bills. The tax hike was a failure.

Now in Illinois there is momentum for another tax hike – this time disguised as “tax reform” that would implement a progressive tax.

The plan circulating across the state would increase taxes on 85 percent of taxpayers.

Since some in Illinois want to push a progressive tax, it’s a good idea to look at the most widely known progressive tax: the federal tax code.

This year marks the 100th anniversary of the federal income tax. In the first year the income tax was enacted, the top tax rate was 7 percent. Just seven years later, when the United States entered World War I, the tax expanded, with a top rate of 77 percent.

This is an example of why we need to stay away from a progressive tax in Illinois – rates eventually will climb higher and higher, and these high rates will creep lower and lower down the income ladder.

So to that end, we’re glad that today state Rep. David McSweeney, R-Barrington Hills, and a handful of other legislators announced their support for a resolution opposing progressive tax.

As we mark Tax Day, we are reminded that Illinoisans are taxed more than enough already – and more taxes will not solve our problems.