Efforts to advance a proposed graduated income tax amendment stalled in the Illinois House Wednesday.
State Rep. Christian Mitchell (D-Chicago), the bill's sponsor, decided against bringing the proposal up for consideration. He said he was unable to reach the three-fifths majority required for the bill's passage. Mitchell claimed "three to five" GOP House legislators were on board to support the measure before allegedly being swayed the opposite way by the governor, who opposes the graduated income tax plan.
Today is the deadline for the House to advance such an amendment.
Illinois currently has a flat income tax of 3.75 percent. A graduated, or progressive, income tax system applies higher rates to larger incomes and lower rates to smaller incomes.
A change in the state income tax would require a constitutional amendment. Mitchell's measure sought to put the issue on the November ballot.
The Responsible Budget Coalition, a supporter of the "fair tax" amendment, expressed disappointment over today's developments in the House. The group issued the following statement:
A Fair Tax is a common-sense tool to help fix Illinois' flawed budget and tax system and find a way out of the chronic annual budget crises. The General Assembly's failure to consider a Fair Tax is disappointing at a time when income inequality is alarmingly high and it is an irresponsible limitation of revenue options while Illinois is in the eleventh month of an unprecedented budget and revenue crisis that threatens to destroy our service and educational systems. The Governor's opposition to the Fair Tax, which effectively blocked the measure, is unjustifiable.
A Fair Tax is supported by strong majorities of voters in legislative districts across the state. It would have allowed lawmakers to raise desperately needed revenue to fund vital services for working families by asking the wealthy to pay their fair share.
A Fair Tax is an important tool the state leaders have now abandoned, but fortunately there are an array of revenue options that remain for the Governor and General Assembly to choose from.
In recent weeks, we heard stories that clearly demonstrate the urgency for the Governor and lawmakers to put aside non-budget agendas and pass a budget that chooses revenue over cuts to services that families, communities, and small businesses rely on. In Southern Illinois, children who have been sexually abused are at risk of losing access to counselors. In Central Illinois, two people died of drug overdoses while on a waiting list for treatment. Community colleges in suburban Chicago have laid off staff and Lutheran Social Services was forced to stop providing services to nearly 4,700 seniors, veterans, youth, and families across the state.
The need for a fully funded budget for this year and beyond remains an urgent priority for families, communities, and small businesses. The Governor and lawmakers must put aside non-budget agendas and pass a budget that chooses revenue over cuts to vital services immediately.
Another progressive income tax proponent is the Grassroots Collaborative, which is stressing the urgent need for revenue solutions to tackle the state's fiscal problems. Amisha Patel, the group's executive director, had this to say after the House's inaction on the graduated income tax amendment:
Springfield should have learned by now that not voting on the tough issues does not make them go away. Our state needs long term structural solutions. Illinois ranks 47th in spending on core public services despite being the 5th largest economy in the US. We have a real revenue problem, we need our leaders to not run away and address this structural issue. We cannot have a stable budget until we modernize our tax structure and make the rich pay their fair share.
Governor Rauner has used his bully pulpit, PAC funds, and his role as head of the Illinois GOP to recklessly push his own personal agenda at the expense of Illinois's people and economy. The Turnaround Agenda is dead. Instead of pressuring his party to obstruct passage of popular, equitable, and rational solutions Governor Rauner should be working with the legislature to fully fund the programs and services our state needs.
Meanwhile, Americans For Prosperity, a conservative organization and opponent of the graduated income tax plan, is pleased by today's outcome in the House. AFP's Illinois State Director David From released this comment:
We applaud the stand a bipartisan coalition of legislators took in opposition to the effort to do away with Illinois' flat income tax. While proponents called it 'fair', the reality is that it would have made it much easier for state politicians to continually raise taxes on segments of taxpayers to fund their latest excessive spending. In light of how our state leaders have spent money over the past decade, it would have been foolish to pass a measure akin to giving them a new ATM card. The other lesson of the graduated income tax in other states is that even if it initially targets higher income brackets, politicians eventually increase the tax burden on the middle class taxpayers to fund their continual over-spending. That is the wrong approach to growing our economy and is one of the reasons more than 1,350 AFP- Illinois activists contacted their legislators on this issue alone.
Now lawmakers can focus on the work they should have prioritized over the past few years- cutting spending and reducing costs by reforming government. Illinois doesn't need more class warfare rhetoric or election year grandstanding to fix the budget and get the state growing. It needs leadership that will make hard decisions and prioritize the interests of taxpayers above those of special interests.