Taxpayers Say Illinois Income Tax Hike is Legal Plunder

By on July 7, 2017   /   Illinois, Items of Interest, Latest, News Releases, Taxpayer Alert  

Jared Labell | Executive Director
312 427-5128 | 773 766-4947

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July 7, 2017

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CHICAGO—With the help of Republican Sen. Dale Righter (Mattoon-55), the Illinois Senate voted 36-19 to override Gov. Bruce Rauner’s (R) budget veto on Independence Day.
Two days later, led by longtime Democratic Speaker and Chicago machine boss Michael J. Madigan (Chicago-22), and including 10 Republicans, members of the Illinois House voted 71-42 to override Gov. Rauner’s veto too.
Together, the Illinois General Assembly enacted the largest permanent income tax hike in the state’s history, raising the personal income tax rate to 4.95 percent from 3.75 percent, and hiking the corporate income tax rate from 7.75 percent to 9.5 percent, which includes the often-overlooked personal property replacement income tax surcharge of 2.5 percent.
“The Illinois General Assembly should really be ashamed,” said Jared Labell, executive director of Taxpayers United of America.
“We know how these tax hikes turn out for taxpayers. We’ve seen this one before. The temporary income tax increase in 2011 brought in more than $32 billion in tax revenue, but did nothing to address the state’s growing unpaid bill backlog and rapidly increasing government pension liabilities, now totaling more than $250 billion according to Moody’s,” said Labell.
“Springfield plans to collect an estimated $5 billion in additional state income tax dollars from hard-working Illinoisans, retroactive to July 1. But taxpayers did not get comprehensive pension reform, property tax cuts, or property tax freezes after two years of uncontrolled spending, $15 billion in unpaid bills, and two years of political maneuvering between the legislators and governor.”
“When was the last time you thought putting vast sums of money in the hands of politicians would be a promising idea?” asked Labell.
“This budget deal is no solution to the longstanding problem of decades of financial mismanagement by the state government. Illinoisans – our friends, our families, our neighbors – have suffered enough. We can do better.”
Labell said there are few solutions Illinois taxpayers should pursue before leaving the state.
“Hiring new government employees under defined contribution 401(k)-style pension plans, rather than lavish defined benefit plans, would help the situation going forward, but Illinois is still facing a quarter-trillion dollars in unfunded government pension liabilities. Taxpayers need a constitutional amendment on the November 2018 ballot to repeal the pension-protection clause of the Illinois State Constitution. It creates a two-tiered system in Illinois that is unsustainable and divides residents into two political classes: government employees and non-government employees,” said Labell.
“Until taxpayers can divert their tax dollars to directly fund whatever services they wish and no more, the legislators in Springfield will continue to engage in generational legal plunder with devastating income and property tax hikes.”

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Taxpayers to Gov. Rauner: No State Income Tax Increase!

By on June 23, 2017   /   Illinois, Latest, News Releases  

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CHICAGO—The president of Illinois’ largest taxpayer organization today urged Gov. Bruce Rauner to reject the proposals of Springfield Democrats and Republicans that would devastate the state’s economy with new, back-breaking tax increases.
“The Democrat and Republican tax-increase proposals are a scam,” said Jim Tobin, President of Taxpayers United of America (TUA). Gov. Rauner states the proposals include spending reductions, limits on expenses, debt reduction, and term limits.”
“The last time the state personal income tax was raised, almost all of the additional money went into the floundering, underfunded state pension funds for retired government employees. Illinois taxpayers in the private sector saw no significant benefit from this tax increase.”
“Gov. Rauner is allowing himself to be hornswaggled by machine boss and House Speaker, Michael Madigan, and by Senate President, John J. Cullerton.”
“The Democrat proposals would permanently raise the state personal income tax by 32 percent, from 3.75 percent to 4.95 percent. The Republican plan isn’t much better. Under the GOP plan, the income tax increase would expire after four years. The four-year expiration date would coincide with a four-year property tax freeze. The income tax hike also would not be retroactive to Jan. 1.”
“Both plans offer virtually no real reforms. The state is effectively bankrupt, and is hemorrhaging taxpayers to states with lower taxes.”
“Illinois has a backlog of unpaid bills exceeding $15 billion, and its unfunded government-employee pension obligations are more than $130 billion. Illinois is beyond the point of no return in that it cannot tax itself out of this mess. The state eventually must bite the bullet and declare bankruptcy, or pass a state constitutional amendment allowing reductions in the lavish, gold-plated pensions being enjoyed by retired government employees—or both.”
“Illinois taxpayers have had it with tax increases.”
Contact: 773-354-2076 or 715-526-2638

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Robocalls targeting three local House districts with strong message against income tax hike

By on June 1, 2017   /   Illinois, Illinois Press, Items of Interest, Latest, Press  

Jim Tobin, Taxpayers United of America’s (TUA) president, was quoted in the Madison-St. Clair Record’s article about TUA’s efforts to ensure the defeat of any proposed Illinois state income tax rate hikes.

 
A proposal increasing state income taxes by 32 percent that passed in the State Senate by Democrats only has inspired the state GOP to target certain House district with robocalls in advance of a possible vote.
Calls going into local districts of state representatives Dan Beiser (D-111), Katie Stuart (D-112) and Jerry Costello (D-116) will in part warn:
“Over the weekend, NBC news reported that 46 Democrats in the Illinois House are committed to voting for a 32 percent income tax increase with no reforms to grow jobs or deliver property tax relief.
“House Speaker Mike Madigan’s plan to force higher taxes without reforms will be one of the largest tax hikes in state history.”
The caller then advises listeners to reach out to their representatives to oppose Madigan’s “tax-and-spend plan without reforms.”
Robocalls are going into 19 House districts across the state, according to a release from the Illinois Republican Party.
Taxpayers United of America (TUA) president Jim Tobin stated in a press release that taxpayers are increasingly venting anger and frustration over tax increase proposals, as they already pay some of the highest state and local taxes in the nation.
The income tax proposal that recently passed by all 32 Democrat senators would raise the individual tax rate from 3.75 to 4.95 percent and it woudl also raise the state corporate tax rte to 9.5 percent. No Republican senator voted in favor of the measure.
“No wonder Illinois has lost more residents than any other state for the third consecutive year,” Tobin stated. “And Chicago, the most corrupt city in the nation, was the only city of the nation’s 20 largest cities to lose population in 2016.”
The TUA press release cited a Chicago Sun Times accounting of taxpayer frustration.
“You dirt bags stop screwing the taxpayers,” posted one person on Facebook, the release states.
Another taxpayer commented, “Keep your grubby hands off our tax money you crook.”
“How dare you raise my taxes in this corrupt state. You are ruining people’s lives with your tax and spend ways,” wrote another.
“Illinois is bankrupt due to the huge deficits of its government-employee pension funds,” Tobin stated. “It is too late for the state to tax itself out of this predicament. Puerto Rico recently declared bankruptcy, and it looks more and more like this is the only salvation for Illinois.”
Even if the House passed the Senate’s tax increase bill, it would likely be vetoed by Gov. Bruce Rauner. Whether it could be overridden is uncertain.
Lawmakers convene today and again tomorrow, the last day of the General Assembly’s regular session. If a budget agreement is not reached, lawmakers could go into overtime where any deals would require a three-fifths or super majority vote for approval, versus a simple majority vote in regular session.

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