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* Dan Petrella at the Tribune has a very good story about yesterday’s budget peekaboo. A small taste…
Pritzker faces high stakes as he prepares to present his third state spending plan to lawmakers.
His proposed change to the state constitution to allow for a graduated income tax was the cornerstone of his plan for addressing the state’s long-running fiscal problems, and it crumbled when voters resoundingly rejected the idea in November.
Pritzker proposal to exempt state income taxes from a federal tax law change that would result in a loss of more than $500 million in corporate tax revenue also fell short when lawmakers rejected it in the waning days of the previous General Assembly in January.
The governor has taken other long-discussed options, including a tax on retirement income, off the table, leaving few options for providing long-term stability. […]
David Merriman, an expert on state finances at the University of Illinois at Chicago, said the plan Pritzker’s office has outlined would do nothing to address the major structural problem facing the state: a lack of adequate revenue to meet its financial obligations and support the programs and services taxpayers expect.
* But the headlines show that the governor’s main message got through…
* No income tax hike in Gov. J.B. Pritzker’s 2022 budget proposal
* Pritzker proposing no spending hikes, no tax increases to deal with COVID-19-related woes
* Pritzker’s Office Says No Tax Hikes, Flat Spending in Upcoming Budget
* Illinois Gov. JB Pritzker’s Budget Plan Won’t Push For An Income Tax Hike For Next Year
* No income tax hike in Pritzker’s budget
posted by Rich Miller
Wednesday, Feb 10, 21 @ 10:49 am
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Maybe it’s big news because so many spent so many months telling us all a huge income tax hike was inevitable if we voted down the Fair Tax Amendment?
And now - Shazam - look at that… almost like it was a talking point or something
Comment by JB13 Wednesday, Feb 10, 21 @ 11:00 am
Retirement income
I wonder how much that would really add to the tax coffers?
I also think the Gov is really counting on a economic rebound to pull at least some of his chestnuts out of the fire.
Comment by Fav Human Wednesday, Feb 10, 21 @ 11:05 am
=I also think the Gov is really counting on a economic rebound to pull at least some of his chestnuts out of the fire=
I agree, but that would diminish pressure on the Feds to offer a rescue package to the states, which JB desperately needs.
Comment by Donnie Elgin Wednesday, Feb 10, 21 @ 11:10 am
So, the preliminary estimated deficit ($3 billion iirc) won’t be made whole by federal assistance; there will be no cuts to ed (assistance from feds, though, DHS, DCFS or IDES (the major state human service agencies), and no tax on retirement income.
Any other possibilities for generating funds? What might the Governor and his advisors be thinking of doing to come up with to cover the projected shortfall?
Comment by dbk Wednesday, Feb 10, 21 @ 11:10 am
That’s a winning news day headlines saying no income tax hike. Not sure how you fill $3 billion hole but sounds good for now and was a good press day.
Comment by Frank talks Wednesday, Feb 10, 21 @ 11:12 am
Did anyone revoke the U of I guy’s press release account? Why would anyone on the state higher ed payroll worry about structural stuff. And who would report it? Other than the Onion
Comment by Annonin' Wednesday, Feb 10, 21 @ 11:15 am
They really need to expand sales to to services, like most other states. We need to keep up with the times.
Comment by Smalls Wednesday, Feb 10, 21 @ 11:22 am
Fav Human: I think the answer is just shy of $2B. Maybe $1.7B. Lots of retirement income untaxed and likely growing as Boomers retire. That ought to finance a $20B pension fund bond to take a huge chunk out of our liabilities.
Comment by Dan Johnson Wednesday, Feb 10, 21 @ 12:20 pm
Time to cut the handouts to big businesses, tax stock, bond and related fund trades (something like a nickel or less per share/trade), extend service life of State-owned assets (such as adding time to vehicle replacement schedules for IDOT as one example); consider leasing of State vehicles and heavy equipment rather than purchase (if not already being done, and cheaper than purchase), sell or lease out unused State buildings to private organizations or businesses (have an empty building a few towns over that’s been listed/delisted as an IDHS office more than once, but the office supposedly being moved there never actually did, leaving them in leased space. Sell off the State share in all publicly-funded but privately-owned or controlled sports stadiums (such as Sox Park, or whatever it’s called now). Allow more State agencies to move more required filings to online or electronic formats, even if it requires changing laws or regulations (no big climate-controlled archive buildings needed to store the paper copies; they can be leased or sold off once all old paper records are scanned and certified,and backed up in existing secure storage and backup servers).
Comment by thisjustinagain Wednesday, Feb 10, 21 @ 12:50 pm
==cut the handouts to big businesses==
Do you mind telling us what handouts you are talking about? Be specific, please.
Comment by FranklinCounty Wednesday, Feb 10, 21 @ 2:29 pm
^^Addendum: Otherwise, I think your ideas are actually pretty feasible and/or likely to happen in the future.
Comment by FranklinCounty Wednesday, Feb 10, 21 @ 2:31 pm
=== The governor has taken other long-discussed options, including a tax on retirement income, off the table===
The only Democrat talking about the Frerichs Tax is Mike Frerichs.
Mike Frerichs stands tall to discussing a tax on retirement income.
I’d be surprised if the Frerichs Tax isn’t talked about in 2022… maybe even a Dem primary discussion.
“Seniors should fear Mike Frerichs and the Frerichs Tax”
Comment by Oswego Willy Wednesday, Feb 10, 21 @ 2:58 pm
Pritzker is not going to tax security transactions.
Perhaps the press release should have said “Pritzker to increase taxes from current levels on businesses by $900,000,000” because that is what he is has and is going to propose.
Comment by Back to the Future Wednesday, Feb 10, 21 @ 3:33 pm