Civic Federation: Tax Hike Won’t Lower Deficit

CHICAGO (CBS) — The oldest non-partisan government research organization in the state says the proposed Illinois income tax increase will not help lower the state’s $15 billion deficit.

As WBBM Newsradio 780’s Mary Frances Bragiel reports, the proposal calls for increasing the individual income tax rate to 5.25 percent, up from 3 percent, and hiking the corporate rate to 8.4 percent – the highest of any state in the union.

LISTEN: WBBM 780’s Mary Frances Bragiel Reports.

Taxpayers who currently owe $1,000 will pay $1,750 with the new rate.

Laurence Msall, President of the Civic Federation says the increase, coupled with Gov. Pat Quinn’s proposal to borrow about $8 billion more, will not make a dent in the state’s deficit.

“This has the potential to have the State of Illinois in the same fiscal position that it was before they raised the taxes,” Msall said.

Instead, Msall believes the structural deficit needs to be fixed. If it’s not, he says could lead to the lowering of the state’s credit rating.

“And at some point, the credit markets and the rating agencies will not afford you the opportunity for reasonable borrowing,” Msall said.

The Democratic leaders in the Illinois General Assembly believe the income tax increase and a corporate tax hike, together with a $1-per-pack tax increase on cigarettes would erase the deficit.

The permanent portion would be used several ways. Some would be devoted to schools and some to repaying an $8.5 billion loan that would be used to pay overdue bills, state Senate President John Cullerton said.

Another chunk would go to property tax relief in the form of annual $325 checks, he said. The checks would replace the property tax exemption that homeowners can now claim on their income taxes.

  • HeorShe

    Please do not pass this proposed tax hike. Listen to the experts and consider the burden already being carried by Illinois tax payers. I am sick of our state government toying with my paycheck!

  • Jim

    The politicians that got us in this mess know exactly what they are doing. Look at it; a lot of them are into real estate. If they tax the heck out of people the people will just move out giving them the opportunity to buy lakefront property dirt cheap! I wish I thought of it 1st!!!

  • Scott Mcdonald

    So, let me get this straight. The Democrat running for governor says he would veto a tax increase like this, gets “elected” by Unions (barely – the margin was 0.5%) and then proposes the tax increase he would have vetoed?

  • Blanche Butler


    The 75% Tax Increase Proposal Should Have Every One of us Outraged and Concerned,

    I sent Governor Quinn and Speaker of the House M. Madigan letters to challenge them to take the high road and do what looks to be impossible that being to bring positive change stability, unity between political parties and resolutions to the issues in our economy that we all have to face today.

    A 75% Tax increase is not an appropriate way to correct the financial difficulties we face today in this state or any state in the USA. This is a LAZY way to pay up for the mismanagement of the past. This is not a resolution this action will just create more hardship to citizens of Illinois.

    In the Corporate world if a person does not perform their job as expected such as
    No measurable way to show tasks performed as agreed to
    No improvement
    employees end up finding the exit door.

    Government employees in the state of Illinois do not have to meet expectations.
    Instead they continue to receive salary increases while Corporate employees pay for them through TAXES and Corporate employees take salary cuts, benefit cuts, NO RETIREMENT because most companies can not afford it anymore. Government employees have many benefits because TAXES pay for them.

    I think that if I and thousands of other citizens in Illinois and in this country have to take Salary cuts, give up benefits, give up retirement for the sake of paying bills. Then the same should apply to ALL state employees and Federal Employees.


    I can go on and on about the mismanaged schools, about unions, political dishonesty, citizens that do not do their homework when they go to the polls to vote.

    I can tell you of my own hardships of which I have several but, I know my story is typical. I am not the only citizen in Illinois struggling to survive.

    The truth is that I hope elected officials listen to the people and NOT RAISE TAXES.


    Instead Cleanup get rid of government people that do not do their job!
    Instead develop ways to measure savings instead of accepting increases of expenses.
    Instead cut salaries so government employees truly understand the grave situation our state and country is in.
    Instead cut benefits of government employees.
    Make government employees accountable for their jobs

    This Tax increase will cause more people to go into financial bankruptcy, foreclosures,
    people will loose jobs, Corporations will start to seriously plan on leaving ILLINOIS.

    Commit to a better future for ourselves and our children.


  • Latest Tax Form News | tax forms

    […] tax increase of Illinois does not help reduce the state’s $ 15 billion deficit. Read more on CBS Chicago Russell final versions of the budget deficit recommendations School District Superintendent […]

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