Arc and Governor to Keep Tax Hike

Do you know where your legislators stand on the need for new revenue? You should!

From to the Chicago Tribune.

Tony

By Ray Long and Monique Garcia Tribune reporters

Gov. Pat Quinn has prepared an election-year spending proposal that would make
permanent the 67 percent income tax increase set to expire in 2015 and couple it with
property tax relief for homeowners, sources familiar with the plan said Tuesday.

Quinn planned to tell lawmakers in his Wednesday budget address that the temporary
tax increase he signed into law in 2011 is needed to fund education, said one of the
sources who was briefed on his plan but not authorized to reveal the details in advance
of the noon speech.

The property tax relief would take the form of a $500 refund, sources said. One source
said it would be an annual refund as part of a restructuring of the current property tax
break for income tax filers.

Quinn was also expected to tell lawmakers that the alternative is to drop the 5 percent
income tax rate to 3.75 as scheduled on Jan. 1, but that would make state programs
unsustainable, sources said.

Budget speeches are political by nature, but Quinn’s address has become fodder for
the heated 2014 campaign before he’s even delivered it.

Republican challenger Bruce Rauner has already accused Quinn of going back on
previous budget pledges and predicted that Wednesday would be more of the same.
Rauner was not expected to be in Springfield for the noon speech, making it easier for
him to deliver a critique of the governor without being pressed by reporters on his own
ideas for solving the state’s financial problems.

Quinn has been largely mum about his spending plans, including the big question of
whether he favors extending the income tax increase. Rauner has said it should expire
but has not said how he would find billions of dollars to replace it or what he could cut to
close the gap.

The governor has pledged to unveil a five-year spending plan with concrete details on
the budget for the fiscal year that starts July 1. Some Democrats were calling for a vote
to extend the tax increase during the spring legislative session no matter what Quinn
proposed.

But it’s questionable whether Quinn’s fellow ruling Democrats would risk voting to extend
a tax increase before the November general election.

Earlier this year Quinn called for doubling the earned income tax credit for low-income
families, and he has previously suggested closing so-called corporate loopholes.
Business taxes are met with fierce resistance in Springfield, but proposing that
corporations pay more in order to provide relief for working families would fit into Quinn’s
campaign theme of narrowing the income gap between the rich and the poor. He’s also
pushing for an increase in the state’s minimum wage.

The Civic Federation of Chicago offered some political cover for extending the tax
increase in its recent proposal for a five-year spending plan. The budget group’s
proposal calls for extending the 5 percent income tax rate for individuals by another
year before gradually reducing it to 4 percent — which is still higher than the 3 percent
rate in place before the temporary increase. The group also suggested broadening the
income tax base by taxing retirement income. rlong@tribune.com   mcgarcia@tribune.com

Tony Paulauski
Executive Director
The Arc of Illinois
20901 S. LaGrange Rd. Suite 209
Frankfort, IL 60423
815-464-1832 (OFFICE)
815-464-1832 (CELL)
Tony@www.thearcofil.org