Illinois to push forward with tax vote as coronavirus crisis roils state economy

Illinois to push forward with tax vote as coronavirus crisis roils state economy

Get all the latest news on coronavirus and more delivered daily to your inbox. Sign up here.

Illinois Gov. J.B. Pritzker indicated Wednesday that he intends for the state to continue with a vote on a planned income tax hike for top earners this November, as he warns the budget could face yawning deficits due to the coronavirus crisis.

“This is a public health crisis, but it is accompanied by massive economic disruption that’s unprecedented in modern history,” Pritzker, a Democrat, said in a statement. “Illinoisans are all too familiar with the pain the lack of a state budget can cause, so let me just say up front: we will not go without a state budget.”

CLICK HERE FOR COMPLETE CORONAVIRUS COVERAGE

Pritzker said in the update that because of the unexpected loss of revenues, the deficit for fiscal 2021 in the state is expected to be $6.2 billion. But he warned if the constitutional amendment to move the state to a graduated income tax fails, that number will be above $7 billion.

Illinois currently has a flat tax of almost 5 percent in place, but Democrats have been pushing to shift the state over to a progressive graduated income tax that would mean those earning less than $250,000 would see slight tax decreases, while those earning more than $250,000 would pay higher taxes.

According to NBC Chicago, voters will decide in November whether to ratify the constitutional amendment to repeal the tax and move to the graduated income tax. Should that be approved, that allows the state government to move ahead with changes to the tax code.

ILLINOIS DEM GOVERNOR AND CHINA IN SECRET TALKS FOR MASKS, GLOVES: REPORT 

A separate Senate bill would implement tax rates whereby those earning less than $250,000 would see their first $10,000 taxed at 4.75 percent, then income until $100,000 taxed at 4.9 percent and from there to $250,000 taxed at 4.95 percent.

For those earning more than $250,000 the tax rate would start at 7.75 percent, increasing up to 7.99 percent for those earning more than $1 million, NBC reported.

It represents what is likely to be a recurring theme for lawmakers as the crisis continues — working out how to stimulate the economy while also recovering money lost due to the labor market decline and the outpouring of financial aid to tackle the crisis.

Pritzker told residents that the state has directed agencies to put a hold on all non-essential purchases and operational expenditures, as well as freezing non-essential hiring and travel.

CLICK HERE TO GET THE FOX NEWS APP

Pritzker has also directed nearly $500 million in additional spending via emergency powers, focusing on personal protective equipment for frontline workers and ventilators for COVID-19 sufferers.

His office noted that the CARES Act, signed into law by President Trump, provides over $9 billion to Illinois for a range of programs, including nutrition and education.

Latest Category Posts