Congress soon will break for the holidays, but there's still a big issue on the table whether or not to make permanent or even just extend parts of the Earned Income Tax Credit and the Child Tax Credit.
Low-income Illinoisans have the third-highest state and local tax burden in the nation, according to a new study by the Institute on Taxation and Economic Policy (ITEP) and the Fiscal Policy Center at Voices for Illinois Children.
The study, which examined the distribution of all major state and local taxes by income group in all 50 states and the District of Columbia, showed that the poorest Illinois residents currently pay almost three times more in taxes as a percent of their income compared to the richest Illinoisans.
Illinois' effective tax rates by income group are 13.2 percent for those in the bottom 20 percent of the income scale, 10.8 percent for the middle 20 percent and 4.6 percent for the top 1 percent, according to the study.
A tax credit helping many lower-income working families keep more of their earnings is proving to be especially important in rural areas and small towns across Illinois and the nation, according to new research.
“Our study found that right-to-work laws weaken state economies and strain public budgets,” said the report's co-author Bob Bruno, a labor professor at the University of Illinois at Urbana-Champaign. “Right-to-work laws not only sap government revenue in the form of reduced tax receipts, but they also increase government spending in outlays for food stamps and the Earned Income Tax Credit.”
A recent report shows that women headed up 40 percent of Illinois' more than 404,100 low-income working families in 2012.
Nationwide, women were the main providers for 4.1 million low-income working families in 2012, with 163,341 of those households being in Illinois, according to the report from the Working Poor Families Project, a national initiative focused on strengthening state-level policies to help working families attain economic security.