The correct way to provide tax relief

by Kristina Rasmussen Much to the dismay of families and businesses across the state, the Illinois General Assembly passed the largest tax hike in Illinois’ history earlier this year. People are hurting as a result. Income once earned for the household budget is now sent to government. The job market remains weak. Businesses understandably want relief....

by Kristina Rasmussen

Much to the dismay of families and businesses across the state, the Illinois General Assembly passed the largest tax hike in Illinois’ history earlier this year. People are hurting as a result. Income once earned for the household budget is now sent to government. The job market remains weak. Businesses understandably want relief.

The correct way to provide that relief is to lower rates for everybody by repealing the tax hike. It’s simple, fair, and sends a strong message.

A “relief” deal currently being negotiated by the governor and the legislature — and now apparently on hold — takes a different approach. Suggested for inclusion would be policies that erode the state’s flat income tax, one of the few bright spots in the Illinois tax code. It would give businesses relief in some areas in exchange for higher effective tax bills elsewhere. It wouldn’t kill the death tax, the most significant driver of out migration. It would offer little to the middle class family who lost a week’s pay to the tax hike.

Tax code changes that make families and businesses more beholden to political favors carved out of a steadily worsening system takes us in the wrong direction. Picking winners and losers ignores the core problem of overspending fueled by debt. Lasting solutions to the state’s ongoing fiscal crisis require serious spending reforms, including pension stability changes.

The current job-killing tax laws do deep harm to a few of Illinois’s largest and most profitable employers. This of course is unacceptable. The Illinois tax code ignores the realities of 21st century global markets. But a remedy to that situation should judged on its own merits, as a standalone piece of legislation.

The General Assembly has an opportunity to send a powerful message to the rest of the world: Illinois will once again promote policies friendly to sustainable job growth and economic freedom with broad-based rate reductions. Don’t settle for less.