Progressive Tax Passes Committee

The progressive income tax for the state of Illinois that Gov. Pritzker ran on has cleared its first hurdle. The Chicago Tribune reports that it has passed Executive Committee in the Illinois Senate on a straight party line vote:

Gov. J.B. Pritzker’s effort to shift Illinois from a constitutionally mandated flat-rate income tax to a structure where higher incomes are taxed at higher rates cleared its first legislative hurdle Wednesday.

The state Senate’s Executive Committee voted 12-5 along party lines to approve a proposed amendment to the Illinois Constitution that would allow for a federal-style graduated-rate income tax. It’s the first of many steps necessary before voters can have their say on the issue, which can’t happen until the November 2020 election at the earliest.

How likely is the amendment to make it that far? Not very says the Illinois News Network:

SPRINGFIELD (Illinois News Network) — Gov. J.B. Pritzker has staked his future budgets on convincing lawmakers and voters to change the state’s constitution to allow for a progressive income tax with higher rates for those who earn more, but not enough members of his own party in House are prepared to put the question to voters.

Fewer than 60 lawmakers in the House are in favor of asking voters to change the state’s flat income tax to a graduated one, according to a report from Politico. That means Pritzker could have to look to other sources to come up with the more than $3 billion he said the state needs to stabilize its finances.

Pritzker ran on changing the flat income tax to a progressive one. For that, there would need to be a constitutional amendment approved by voters. The House would need 71 votes to pass it to voters. Multiple roll call votes on the progressive tax proposal registered support “in the 50s,” Politico reported. To pass just the rates, if there were ever a constitutional change from the flat tax to the progressive tax, it would require a simple majority of 60 votes in the House.

which is why I’ve been asking for a whip count for the last six months. Without Republican defections that would mean that 71 of 74 Democrats would need to vote “Aye” and I don’t think the governor has the votes.

Recently, the governor challenged people for an alternative plan. Here’s mine:

  1. Raise the personal income tax rate to 5%. I mean, what kind of rate is 4.95%, anyway? If that actually increases revenue by no less than 1%, it could be increased more later.
  2. Subject all public pensions in excess of twice the state median household income to state income tax. The state median household income is around $60,000 so that means that public pensions greater than $120,000 per year would be subject to the tax. That should pass constitutional muster.
  3. Ban the paying of public pensions greater than three times the state median household income, i.e. $180,000. That would require amending the state constitution.
  4. Require school districts to contribute at least 50% per year to the state fund to pay the pensions of teachers retired from their districts. That would discourage the practice of goosing pay in the last several years of active service to increase the amount for which the state is on the hook and over time lower the exposure. They should be paying 100%.
  5. Make a transition to a defined contributions plan for all present Illinois public employees. That would require a constitutional amendment, too (same one).

That would at least be a downpayment.

6 comments… add one
  • steve Link

    Those sound reasonable to me. #5 should be the norm for all government jobs now I think. (Who wrote your constitution? It seems pretty awful on this stuff.)


  • It was written in the late 1960s and adopted in 1970, the result of a constitutional convention. Every 20 years there’s a vote on whether we want to hold a constitutional convention. We declined in 1988 and 2008.

  • steve Link

    Hmmm. Well I assume you folks in Illinois dont have that fetish about your constitution writers being inspired by God and filled with the Holy Spirit like some people hold with the US Constitution. If anything, it looks like your version of James Madison, at least in this area, was inspired by sources on the other side of the spiritual divide. (Looking at the list of Illinois governors it looks like Kerner, the governor during most of that period, was one of many of your governors to go to jail at some point.) Surprised Big Jim didnt take a crack at fixing it.


  • Good ideas, Dave, but they’ll never happen. The Dems will NEVER do anything to upset the public employee unions, particularly the teacher’s unions.

    Nor will legislators vote to cut their own ludicrous pensions.

  • CuriousOnlooker Link

    I am surprised that pensions are not subject to income tax. That is somewhat reckless policy?

    At the federal level, with defined contribution plans, all distributions are taxed as income if it’s pretax (normal 401k), or taxed before contributing if posttax (Roth). The principle is this must be taxed as income at some point.

    Does Illinois exclude senior wage income as well?

  • Illinois taxes the wage income of seniors.

Leave a Comment