Gov. J.B. Pritzker
DuPage County has been projected to lose nearly 5,000 jobs during the COVID-19 crisis. Now the Illinois Business Alliance is calling on Illinois Gov. J.B. Pritzker and legislators in Springfield to remove the progressive income tax off of the November 2020 ballot.
This request comes as tens of thousands of Illinois residents filed unemployment benefit claims related to the COVID-19 outbreak and spread. Statewide, more than 64,000 individuals filed for unemployment between March 16 and March 18. In DuPage County, the estimate is 4,671 claims, but those figures may be low, considering concentration of industry in the county.
The progressive tax proposed by Pritzker could lead to another 7,000 jobs lost in DuPage County, and is projected to cost the state more jobs than it added in all of 2019, and the IBA says that now is not the time to be adding to Illinois residents’ worries.
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"There's a time and a place to debate a graduated income tax, but now is not that time. People throughout the state are distraught and they don't know how the pandemic will affect their jobs and their livelihoods. Some businesses have been forced to close because of mandates from the state, while others that remain open face difficult decisions: Should we shut our doors? Keep employees at home? Can we afford to have zero income while the state practices social-distancing? Adding the prospect of higher taxes to their plate is unthinkable right now," Jared Carl, President of the Illinois Business Alliance, said in press release. "What Illinoisans need right now – including the business community – is stability and relief, not a potential tax increase."
That progressive tax increase is touted as aiming for the state’s top earners, but critics say there is no doubt that every taxpayer in the state would feel the impact. A report from the Illinois Policy estimated that the so-called “fair tax” would cost families in DuPage County $3,500, and it wouldn’t fix the state’s dire financial situation, which is partly caused by pension problems.
DuPage County is projected to lose more than 39,000 of the total 286,000 jobs an Illinois Policy report said the entire state can expect to lose under Pritzker's proposed fair tax.
IPI provided an income-based chart showing how much each income tax bracket would be required to contribute under Pritzker's proposed rates. Those rates would be 4.75 percent for the lowest income bracket of $0 to $10,000, and up to 7.95 percent for the highest income rate of $1 million or more.
With those numbers, Pritzker’s plan would still have to raise up to $19.4 billion in fiscal year 2021, and it is unlikely to raise that much.
“(The) typical Illinois family would pay between $2,425 and $3,508 more in income taxes," Illinois Policy reports. "Even closing the structural deficit with a progressive tax hike similar to what Pritzker proposed would require hiking taxes on the average middle-class family by nearly $270."
The Illinois Business Alliance maintains that changing the tax structure at this time of crisis is dangerous for the state's financial health and would add an additional, unnecessary level of uncertainty to the engines of Illinois' economy.