Experts available to discuss why Illinois should not enact so-called “Millionaire’s tax”

May 21, 2015

SPRINGFIELD (May 21, 2015) – The Illinois House is scheduled to vote this afternoon on a so-called “Millionaire’s tax” proposed by Democrat House Speaker Michael Madigan. Tax and economic experts with the Illinois Policy Institute are available for interviews to discuss why raising taxes on small businesses is the wrong approach.

“This tax increase is being billed as a ‘tax on the rich,’ but in reality this proposal will raises taxes on small businesses in Illinois who already are struggling to keep their doors open,” said Kristina Rasmussen, executive vice president at the nonpartisan Illinois Policy Institute. “Spending reform, not more revenue, is what Illinois government needs.”

The proposed tax increase would add a three percent surcharge tax on all income exceeding $1 million. At least half of the revenue that this tax increase would generate would come from small businesses or business investment returns. If enacted, the “millionaire’s tax” would raise taxes on a majority of the small businesses in the state.

Key facts:

  • The so-called “Millionaire’s tax” would hurt small businesses in Illinois. According to the IRS, half of the $1 billion that this tax increase is expected to generate would come directly from Illinois small businesses and business investment returns.
  • High taxes are driving people out of Illinois, and keeping people from moving into the state. Just this morning, the Chicago Tribune reported that Chicago’s population grew by only 82 residents last year. Illinois Policy Institute research shows that since 1995, Illinois has lost 1.36 million people to other states on net outmigration. That is after accounting for people who have moved into the state. High taxes and a sluggish economy are consistently listed as leading reasons for people leaving the state.
  • In 2011, Illinois increased income taxes by 67 percent. This tax increase generated $31.5 billion in additional tax revenue from 2011 to 2015. Ninety percent of that new revenue was used to fund pensions.

FOR INTERVIEWS, CONTACT: Diana Rickert or Nathaniel Hamilton 312-607-4977