Will a state tax increase be coming soon?

  • Illinois Gov. Bruce Rauner speaks to reporters in his office at the Illinois State Capitol Monday, May 23, 2016, in Springfield, Ill. Rauner and Republican leaders in the Illinois Legislature gathered to talk about the final week of the legislative session. Looking on is Illinois Senate Minority Leader Christine Radogno, R-Lemont, center, and Illinois House Minority Leader Jim Durkin, R-Western Springs, right.

    Illinois Gov. Bruce Rauner speaks to reporters in his office at the Illinois State Capitol Monday, May 23, 2016, in Springfield, Ill. Rauner and Republican leaders in the Illinois Legislature gathered to talk about the final week of the legislative session. Looking on is Illinois Senate Minority Leader Christine Radogno, R-Lemont, center, and Illinois House Minority Leader Jim Durkin, R-Western Springs, right. Associated Press

 
and Mary Hansen
mriopell@dailyherald.com
mhansen@dailyherald.com
 

Talk of a tax hike looms in Springfield as lawmakers face a growing state deficit and a week to go before blowing yet another budget deadline.

An income tax increase and an expansion of the sales tax onto more purchases were part of a "framework" that some rank-and-file lawmakers sent to leaders last week.

But a look back at the political climate that ushered in Illinois' 2011 income tax hike (and subsequent rollback) shows how difficult it might be for Democrats and Republicans in a divided Springfield to make a decision on taxes this time around.

In January 2011, Democrats barely mustered the minimum number of votes needed to approve an income tax increase from 3 percent to 5 percent in the overnight hours before a new class of lawmakers was to be sworn in.

It was two months after the election. Voting for a tax increase can be hard even for a lame-duck lawmaker, and some who did subsequently landed in state jobs.

This year, a tax increase isn't the only thing preventing agreement on a state budget as Republican Gov. Bruce Rauner continues to push lawmakers to approve goals he argues will improve Illinois' business climate.

by signing up you agree to our terms of service
                                                                                                                                                                                                                       
 

Crucially, the November election is ahead of lawmakers, not behind them.

It could help define whether Rauner gains allies in Springfield or loses more ground.

In campaigning against former Gov. Pat Quinn two years ago, Rauner criticized the Democrat for the income tax hike and release a plan that called for tax rates to go down by the end of his first term.

Now, Rauner says he's open to a tax increase if Democrats sign off on some of his policy goals.

"If we put in a big tax hike to cover the deficit in the short term and that's all we do with no reforms, the stream of businesses leaving the state will turn to a flood," Rauner said Monday.

                                                                                                                                                                                                                       
 

Many Democrats, led by House Speaker Michael Madigan, say Rauner's policy proposals are meant to destroy labor unions in the state, a standoff that has helped define a budget war that is approaching its one-year anniversary.

"(Rauner is) not interested in finishing the job he was elected to do," state Rep. Lou Lang, a Skokie Democrat, said at a massive union rally last week. "We may or may not have a budget during the entire term of Bruce Rauner."

A rank and file group of lawmakers working behind closed doors has sent to leadership a so-called framework of taxes and cuts that includes raising the state income tax from 3.75 percent to 4.85 percent and expanding the Illinois sales tax. Lawmakers who helped write it say that kind of tax increase plus more than $2 billion in cuts are needed to make the state budget balance.

But the idea hasn't been publicly embraced by many officials. TV and video ads already pushing lawmakers for property tax relief could foreshadow what might follow a move to raise other taxes.

                                                                                                                                                                                                                       
 

If neither side gives in, the Illinois budget stalemate will keep setting records. Several states in the U.S. have approved two budgets in the time Illinois has been without one.

In the meantime, colleges, universities and social services groups who care for victims of domestic abuse, for example, are working to stay afloat as they deal with the absence of a full state budget since July 1.

If lawmakers and Rauner can't cut a spending deal before May 31, the Illinois Constitution requires them to get more votes to approve a new budget, making any final agreement even harder to come by.

The 2011 tax increase needed fewer votes because it was done in January, when budget pressure loomed and the election was over. The same vote rules would be in place in January 2017, if the standoff continues that long.

0 Comments
 
Article Comments ()
Guidelines: Keep it civil and on topic; no profanity, vulgarity, slurs or personal attacks. People who harass others or joke about tragedies will be blocked. If a comment violates these standards or our terms of service, click the X in the upper right corner of the comment box. To find our more, read our FAQ.