ILLINOIS (WIFR) – A 5% income tax increase was supposed to end this year, however now, Quinn is asking for the move to stick around permanently to help pay off the state’s debt.
The request comes from the governor’s budget address today.
He says extending the increase is the best long-term solution, claiming that without it, Illinois would lose more than $1.5 billion in revenue and that the state would face “extreme cuts that would starve our schools.”
Right now, the state faces billions in unpaid bills, a low credit rating, and uncertainty when it comes to pension debt.
"By taking this comprehensive approach to tax reform, we can stabilize the budget for the long-term, in a way that provides targeted tax relief where it's needed most: to homeowners and working families raising kids,” said Gov. Pat Quinn.
The Illinois House is expected to call for a vote on making the state’s tax increase permanent this spring.
The governor also says he wants to offer a tax refund for homeowners. Quinn says each family will get a $500 refund each year.
However, the state legislature will still need to pass any proposal for a permanent income tax hike. We spoke to local state senators from both sides of the aisle to get their take on the idea of a permanent 5% sales tax.
Out of states that border Illinois, only Indiana has a lower income tax rate than Illinois’ current 5%. Then again, only Wisconsin out of the border states has a higher average property tax rate than the Prairie State.
“It’s not even a fix, it’s a quick feel good.”
Joe Vettore says he pays about $2,500 more in property taxes since he moved from Roscoe to Rockford a year ago.
Governor Pat Quinn hopes to ease that pain by offering a $500 refund to homeowners ever year.
“I could take that $500 today and spend it on something or I can take that tax relief over the next 20 years and use that money for the next 20 years,” Vettore said.
It’s part of Governor Quinn’s five year tax reform plan which includes making a temporary income tax hike permanent.
“With income tax being as high as it is, I’t hard for businesses to fund that.”
As the sales director at Holiday Inn Express, Carli Stockstad says the Rockford area is losing too many businesses already.
“The companies that will come to Rockford aren’t going to be locally grown. I think they’re going to be part of corporations and even then I think they will consider us, but ultimately go to a different city or a state where the income tax is lower,” aid Stockstad.
As for Quinn’s November opponent, Bruce Rauner says that in today’s address, the governor just doubled down on his failed policies of the past.
SPRINGFIELD, Ill. (AP) -- Gov. Pat Quinn wants to make the state's temporary income tax increase permanent to prevent "extreme and "radical" budget cuts.
The Chicago Democrat also said during his annual budget speech Wednesday he wants to give homeowners a $500 annual property tax refund.
The speech comes as the state faces dire financial problems and Quinn embarks on what's anticipated to be a difficult re-election bid against Republican businessman Bruce Rauner.
Quinn proposed maintaining the state's income tax increase, saying that it'll be a "real challenge." The increase rolls back next year, leaving a $1.6 billion revenue dip.
Quinn says extending the increase is a better long-term solution.
Illinois has billions in unpaid bills, a low credit rating and uncertainty with its pension debt.
SPRINGFIELD, Ill. (AP) -- Gov. Pat Quinn is expected to propose making Illinois' temporary income tax increase permanent when he presents his budget.
That's according to lawmakers who were briefed on Quinn's plans ahead of Wednesday's speech but weren't authorized to discuss publicly before the noon address.
The state's roughly 67 percent income tax increase was approved in 2011 and starts to roll back in January. That means an estimated $1.6 billion revenue dip. State agencies have been bracing for dire cuts.
Quinn is expected to say making the tax increase permanent will help avoid cuts and detail the scenario of what it would look like if the tax was rolled back.
Lawmakers say he's expected to tie the idea to relief for homeowners, proposing those who pay property taxes get a $500 refund.