After 2 suburban Democrats replaced, House committee advances tax rate bill

SPRINGFIELD - A graduated tax rate bill has joined the constitutional amendment that would allow for the implementation of such a tax structure in awaiting a vote from the full Illinois House.

The bill, which adopts the same rates approved by the state Senate, was advanced by the House Revenue & Finance Committee on a 9-6 party line vote Friday after House Speaker Michael Madigan replaced two "swing vote" suburban Democrats on the committee with substitutes.

Rep. Sam Yingling of Grayslake and Rep. Jonathan Carroll of Northbrook both have said publicly they would not support a graduated tax plan that does not offer more systemic property tax relief.

Rep. Mike Zalewski, a Riverside Democrat and House sponsor of Senate Bill 687, said he expects the House to take up the full amendment and rate structure package next week.

While the amendment would need 71 of the chamber's 74 Democrats to vote for it, the rate structure requires only 60 "yes" votes.

The state Constitution now mandates taxes be levied at a flat rate. The current rate is 4.95 percent. Ultimately, voters in 2020 would have the final say on allowing a switch to a graduated tax system.

Per the rate structure approved by committee Friday, single filers would pay the maximum rate of 7.99 percent on all income once their taxable income tops $750,000. For joint filers, that rate would take effect when income tops $1 million.

For joint filers outside the top brackets, the rates are 4.75 percent on taxable income from $0 to $10,000; 4.9 percent from $10,001 to $100,000; 4.95 percent from $100,001 to $250,000; 7.75 percent from $250,001 to $500,000; and 7.85 percent from $500,001 to $1 million.

For single filers, tax rates would be the same as joint filers up to $250,000, but the 7.75 percent rate would apply only from $250,001 to $350,000, while the 7.85 percent rate would apply from $350,001 to $750,000.

Republicans say a graduated tax system would drive residents out of the state and make Illinois too reliant on the wealthy.

Democrats say Illinois needs the estimated $3.5 billion in revenue the bill would generate to close budget deficits and give the state the stability it needs to attract new residents and businesses.

The House is scheduled to reconvene Sunday, with substantial action expected to begin Monday.