Evidence from Connecticut suggests the progressive income tax could cost Illinois homeowners substantial equity in their homes.View Report
The credit rating agency also said Illinois will soon pass the point of no return on public pension debt. It warned against schemes to stretch or delay pension payments.
Multiple members of the governor’s inner circle have publicly backed retirement taxes, even though Pritzker now denies he will use his “fair tax” on the state’s seniors.
Illinois would have lost an additional 10,577 seniors from 2012 to 2018 if outmigration were as severe as in Connecticut, the last state to enact a progressive income tax.
Taxing retirement income is not a new idea to Illinois politicians, but denying they want to tax seniors is new since that part of the “fair tax” plan slipped out.
Illinois politicians are already talking about taxing retirees, adding “surcharges” and city income taxes if they can convince voters to abandon the Illinois Constitution’s flat tax protection and give lawmakers greater taxing power.
Passing the progressive tax would empower state lawmakers to go after seniors’ retirement income.
Illinois could be the next state to tax retirement income if voters approve the progressive income tax in November.
Illinois Treasurer Michael Frerichs said a progressive state income tax will open the door to taxing retirement income.
By granting broad new taxing authority to Springfield, the progressive income tax amendment makes a retirement income tax much more likely – a fact some supporters have acknowledged publicly.