Madigan resolution supports progressive income tax

House Speaker Michael Madigan’s proposal did not include potential rates for the progressive income tax. (WJBC file photo)

By Greg Bishop/Illinois Radio Network

SPRINGFIELD – Illinois House Speaker Michael Madigan and several dozen other Democrats in the House are putting their names behind a non-binding resolution urging support for a progressive income tax. 

Taxpayers in the Land of Lincoln pay a flat income tax, regardless of how much they earn. Democrats at the statehouse have for years talked about changing that to a progressive, or graduated system, where residents who make more money pay a higher percent to the state’s coffers. 

After being re-elected chairman of the Democratic Party of Illinois earlier this week, Madigan said the discussion on a progressive tax will translate into how people vote in November. 

“I think it will be very helpful to the people of Illinois and the voters of Illinois in terms of their electoral decision on the method of taxation,” Madigan said. 

Madigan said he favors a progressive income tax. 

“Taxation can be fair or it can be not fair, one or the other,” Madigan said. “And I think the discussion on the progressive tax is designed to make the taxation system more fair.” 

J.B. Pritzker, Democratic candidate for governor, has been pushing for a progressive income tax during his campaign. 

Republican Gov. Bruce Rauner’s political campaign put out a statement after Madigan’s non-binding resolution, criticizing the progressive tax discussion that lacks any inclusion of what rates could be under the Democrats’ plan. 

“The Pritzker-Madigan ticket still doesn’t want to say how high taxes will go,” Rauner’s campaign statement said. “Pritzker has repeatedly dodged on specifics and Madigan responded with a firm ‘NO’ when asked if he had any rates in mind. How can Illinois families trust Pritzker and Madigan when they have provided no details for their plans?” 

Rauner has repeatedly said a progressive income tax would be a disaster for Illinois. 

State Rep. Robert Martwick’s House Bill 3522 proposed changing the tax rates to: 4 percent for income up to $7,500, 5.84 percent for income up to $15,000, 6.27 percent for income up to $225,000 and 7.65 percent for income over $225,000. That measure was tabled.

Illinois’ current flat tax rate is 4.95 percent, after being increased from 3.75 percent last summer. Under Martwick’s plan, anyone earning over $15,000 a year would see a tax increase. 

“When I filed my bill, my bill was not filed as a ‘here’s the solution to our problems,’ it was ‘here’s an option,’ ” Martwick, D-Chicago, said. “You can’t solve the financial problems that we have … unless you’re willing to raise the revenue to address those.” 

Martwick said the numbers he had the Commission on Government Forecasting and Accountability crunch for his plan would increase revenue for the state by $5.5 billion a year. 

Republicans have long said Illinois doesn’t need more revenue through tax increases, it needs more revenue through economic growth. They also want the state to control spending. 

Earlier this month, House Minority Leader Jim Durkin, R-Wester Springs, said with Illinois second-highest-in-the-nation property taxes and high overall tax burden, Illinois’ constitutionally mandated flat income tax is one of the state’s few saving graces. 

Durkin said changing the flat tax to a tiered tax structure will hit small businesses and job creators hard. 

“We cannot give taxpayers in the business community even more reasons to leave and that is exactly what the progressive tax would do to illinois,” Durkin said. 

The text of Madigan’s resolution claims the opposite is true. 

“A progressive income tax will stimulate small business growth; a smaller tax burden will be placed upon small businesses, thereby giving them the additional resources needed to reinvest in their businesses and ultimately increase their net income, providing further stimulus for small business formation and growth,” the resolutions says. 

All but one House Republican signed on to House Resolution 975 opposing a progressive tax ballot question, effectively killing the measure. 

State Rep. Grant Wehrli, R-Naperville, said with all the talk of a progressive income tax from Democrats, the only solid proposal was alarming. 

“So their proposal is to raise the rates and then offer deductions,” Wehrli said. “We all know that that’s a tax hike on all of us.” 

Constitutional amendment ballot questions that don’t have rate structures attached have been filed in both chambers, but they’re not expected to go anywhere. 

Madigan’s proposal is House Resolution 1025.

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