CHICAGO (WBBM/CBS) – Mayoral candidate Carol Moseley Braun is blasting the Illinois General Assembly’s approval of a massive income tax hike.
As WBBM Newsradio 780′s Lisa Fielding reports, Braun said raising the state income tax from 3 percent to 5 percent was shortsighted.
LISTEN: Newsradio 780′s Lisa Fielding reports
“We want our money back,” Braun said.
Braun says one major problem is that the extra 2 percent in tax revenue isn’t going to Illinois cities.
“Not only are they increasing taxes, but they’re keeping what has historically been Chicago’s share to help pay for their failure to control spending at the state level,” Braun said.
Braun says that will mean the city will miss out on $280 million of what is called a local distributor’s share, used to pay for police and fire pensions, and day-to-day operations.
Braun also criticized the lack of property tax relief, and blasted lawmakers for their decision not raise the cigarette tax.
The tax hike raises the personal income tax from 3 to 5 percent for four years. Then the rate drops to 3.75 percent. In 2025, it would drop again to 3.25 percent.
The hike will also boost the corporate income tax rate by nearly 50 percent, from 4.8 percent to 7 percent. In 2015, it would drop to 5.25 percent and in 2025 would drop again to the current rate of 4.8 percent.
In addition to the corporate income tax, many businesses in Illinois pay a “Personal Property Replacement Tax” of 2.5 percent of income, bumping their corporate tax rate to 9.5 percent.
The tax hike bill also would limit spending increases to 2 percent a year.
If officials spend above those limits, the tax increase will automatically be canceled.