Wisconsin competes for jobs while Illinois moves in the wrong direction

December 20, 2013
By Justin Hegy

Wisconsin Gov. Scott Walker recently expressed interest in eliminating his state’s income tax.

Walker realizes this move will give Wisconsin a competitive edge in competing for jobs and attracting new business. This new reform would add to important steps that state already has made, including labor reforms in late 2011 that helped the state’s budget woes and helped restore Wisconsin to fiscal health.

Wisconsin is not alone in enacting such pro-growth policies, as 18 other states have enacted comparable policies in the 2013 legislative session.

Illinois, on the other hand has moved in the opposite direction. The state “temporarily” raised individual income tax rates by 67 percent in 2011, and politicians are now talking about making this tax hike permanent. Some politicians, such as Naomi Jakobsson, D-Champaign, have even proposed a progressive tax that would further raise tax rates on middle class-families.

The benefits for Wisconsin are clear.

Wisconsin’s unemployment rate has been consistently lower than the national average, while Illinois’ ranks fourth-highest in the nation. Wisconsin has a balanced budget, while Illinois hasn’t passed a balanced budget since 2001 and has $8 billion in unpaid bills.

Many companies, such as Kenall, Hanna Cylinders, Emco Chemical and Noark Electric, have recently left Illinois and moved directly to Wisconsin. Wisconsin is gaining jobs and population from neighboring states – Through out-migration, in less than two decades $2.22 billion of personal income has left Illinois and gone to Wisconsin.

Illinois needs to take heed of other states competing for businesses and jobs – the losses are direct and real. Unless Illinois starts lowering taxes, reducing labor regulation and moving toward pro-business policies, it will continue to lose jobs and companies to other states.

TAGS: gov walker, income tax, jobs, taxes, unemployment