Pritzker budget: $93M income tax hike for record spending

Pritzker budget: $93M income tax hike for record spending

Gov. J.B. Pritzker wants to take nearly $100 million more from Illinoisans through state income taxes, averaging $45 per family.

Gov. J.B. Pritzker’s 2025 budget proposal includes a $93 million income tax hike on individuals. He wants to again renege on the state’s promise to taxpayers that the standard income tax exemption would increase with inflation.

Lawmakers in 2022 froze the standard personal exemption at $2,425 to generate more revenue from taxpayers. That offset decades-high inflation for government but denied that same benefit to taxpayers who had been promised it.

Had lawmakers let the exemption rise to adjust for inflation, there would have been a record $200 increase to $2,625. By freezing the exemption, the state brought in an extra $114 million from income tax filings.

Now, after skipping two years of inflation adjustments, the state’s current standard exemption for tax year 2024 is set at $2,775 per income taxpayer and dependent.

Pritzker wants to reduce that exemption to $2,550 per income taxpayer and dependent –essentially taking away one year of inflation adjustments.

The change would effectively make an additional $225 of income taxable per applicable individual. For a family of four, that amounts to a $45 loss.

The tax increase would disproportionately fall on lower-income earners who receive a larger tax break from the exemption than higher-income earners. If lawmakers approve, it’s a harsh way for Pritzker to spend a record $52.7 billion without state government making any sacrifices, reforms or controls.

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