Cigarette tax progresses, income tax hike in limbo
SPRINGFIELD — Illinois lawmakers have convened their session today, a potentially busy day that could see crucial votes over an income tax increase, the expansion of gambling in Illinois, the abolition of the death penalty, a $1 per-pack hike in the cigarette tax, and a plan to borrow as much as $8 billion to pay the state's huge amount of unpaid bills.
The legislative process in Springfield starts over Wednesday afternoon when the new General Assembly is sworn in. That means if lawmakers don't act on those issues now, all of their efforts would have to start from scratch.
Those deadlines have sparked a frantic, last-minute dash among tax-increase supporters to deliver Gov. Pat Quinn his capstone plan for the state budget. It's also sparked panic in anti-tax lawmakers who say asking cash-strapped Illinoisans and businesses to pay more in times of recession could cause the economy big problems.
Lawmakers might see legislation to increase the income tax rate for individuals to 5 percent, top Democratic budget negotiators said Monday. Previous talks among top Democrats asked lawmakers to raise the income tax to 5.25 percent from 3 percent. But details remained in flux.
“We're trying to get somewhere where everybody can be comfortable to vote on something,” said Rep. Linda Chapa LaVia, an Aurora Democrat. “But these are hard votes, and it's not for the faint of heart.”
Plans to borrow as much as $8 billion to pay down the state's piles of unpaid bills could remain part of the package, along with the idea of sending homeowners $325 annual checks to help with their property taxes, the budget negotiators said.
At least part of the higher income tax rate would be temporary, used to pay off loans for the next four years.
The changes come as the original, bigger tax plan drew a strong rebuke from suburban lawmakers, including Democrats who control both the House and the Senate. A smaller rate might raise a tax-increase proposal's chance of approval. Most Republicans remain staunchly against the plan, though.
Rep. Bob Biggins, an Elmhurst Republican, said he wouldn't commit to supporting or opposing a tax increase plan either way.
“I'm not going to take a position until I see it,” Biggins said.
Plans for the legislation — which hadn't yet been filed as of Monday afternoon — could change quickly and with little notice before lawmakers sit to make their votes. Steve Brown, spokesman for House Speaker Michael Madigan, said the plan is still “evolving.”
“That evolving continues even today,” Brown said Monday afternoon.
In addition, Illinois lawmakers Monday began moving a plan to increase cigarette taxes by $1 per pack just as plans to increase the state's income tax rate were changing fast.
The cigarette tax increase could raise about $375 million a year, most of which would be tapped to pay for schools.
Daily Herald staff writer Jeff Engelhardt contributed to this report.