The Second Annual Pat Quinn Income Tax Increase Proposal

Illinois Gov. Pat Quinn pushed for a 50 percent increase in the personal income tax last year but failed to gain any semblance of public or legislative support for the proposal. This time around, the Governor has scaled  back his plan, proposing a 33 percent income tax increase that would bring the state's flat rate up to 4 percent from 3 percent.

It's clear that Quinn does not get it. The public appetite for a 33 percent tax hike is no stronger than for a 50 percent increase. While last year's proposal was indeed massive, public backlash against the 2nd Annual Pat Quinn Income Tax Increase Proposal will be no quieter this time around.

That's because Illinois taxpayers are tightening their belts to cope with the economic downturn and its corresponding 11.3 percent unemployment rate in the state. They look to the state capitol and see politicians looking to spend more, borrow more, and tax more. They see politicians unwilling to govern and eager to cut corners and make the easy decision to raise taxes.

House Speaker Michael Madigan hit the nail on the head when he said:

"Let's be straightforward about this. The people of Illinois, they don't want tax increases. They're hurting. The American economy is in bad shape. People are out of work. They don't want to hear about tax increases."

Either Gov. Quinn is misreading the polling data, or he is completely indifferent to the concerns of his consituents.

See ATR's letter to the Illinois Legislature pasted below.

March 15, 2010

 

 

 

Illinois House

Illinois Senate

 

Dear Legislator:

 

Governor Pat Quinn has cemented his legacy as a tax hiker unwilling to confront the spending crisis in Springfield. After pushing for a 50 percent income tax hike in 2009, this week he formally called for a 33 percent increase in the tax, which he euphemistically labeled an “income tax surcharge.” Make no mistake: Pursuing this course of action rather than confronting state government’s overspending problem may be the final straw for Illinois, a state that has been in decline for over a decade.

 

The cause of the current budget hole, approaching a staggering $13 billion, is clear. State spending has increased 39 percent over the past decade, adjusted for inflation. Meanwhile, state population grew a measly 7 percent over the same period. There has been absolutely no political will in the Capitol to cut wasteful, duplicative, and unnecessary spending from the budget. The state does not face a $13 billion deficit; it faces a $13 billion overspending problem.

 

With the explosion in spending comes government waste, fraud, and abuse. The Illinois Alliance for Growth points out that despite the public education lobby’s contention that budget cuts automatically cause teacher layoffs, administrators such as University of Illinois President Richard Ringstein will continue to collect six-figure salaries after retirement.

 

By reforming the way state government spends taxpayer dollars, Illinois could have completely avoided this crisis. But government instead allowed borrowing and spending to explode, including a $36 billion increase the state’s unfunded pension liability between 1996 and 2008. Now Gov. Quinn wants to couple a $1 billion tax increase with nearly $5 billion in new borrowing, eroding Illinois’ comparative income tax advantage while further destroying the state’s bond rating.

 

The public’s aversion to tax increases was best embodied by House Speaker Michael Madigan, who noted succinctly, “The people of America don’t want a tax increase.” Because the Speaker went on to praise Gov. Quinn’s “courage” in proposing to raise the income tax, he should be reminded that Illinois is indeed one of the United States of America.

 

I urge you to reject the status quo approach to budgeting in Springfield – tax increases, borrowing, and federal bailouts. Tackling this crisis starts with honest spending reform. Gubernatorial candidate Bill Brady’s proposal to reduce government to 90 percent of last year’s size is a good start.

 

It’s time to show taxpayers a commitment to fiscal responsibility. Vote no on the Quinn tax increase.

 

Onward,

 

Grover Norquist

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