Edgar: Tax Hike Was Only First Step
Lastest News Headlines:
Get Breaking News First
ELMHURST, Ill. (CBS/WBBM) – While many of his fellow Republicans are denouncing the hastily-passed Illinois state income tax increase, former governor Jim Edgar supports it.
But as WBBM Newsradio 780’s Regine Schlesinger reports, Edgar says the tax hike is only the first step in fixing Illinois’ financial mess.
LISTEN: Newsradio 780’s Regine Schlesinger reports
Edgar, who served two terms as governor from 1991 to 1999, says it took courage for Democratic lawmakers to approve the tax hike in the final hours of the lame-duck General Assembly.
The Daily Herald reports Edgar recently told a forum at Elmhurst College that now, together with Republicans, the Democrats have to muster the courage to put the state on a fiscal diet.
He says such a “diet” will require hard cuts to Medicaid and even the “sacred cow,” education.
He told the crowd, “If we’re going to get out of this mess, we’re all going to have to swallow and do some things we don’t want.”
He says Gov. Pat Quinn has to take the lead in cutting spending.
Under the new law, the state’s personal income tax rate has gone up from 3 percent to 5 percent. In real numbers, if your gross income is $50,000 a year, your state income taxes will rise from $1,500 to $2,500 a year.
The hike boosted the corporate income tax rate by nearly 50 percent, from 4.8 percent to 7 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.
Backers hope the tax hike will help plug a $15 billion budget hole.