As state lawmakers look to plug budget holes by removing limits on state income tax rates, Illinois’ spending is set to continue breaking records.
By Ravi Mishra | Illinois Policy Institute
The state budget has grown by 35% since 2020, but Illinois lawmakers want more and hope to get it by amending the Illinois Constitution so they can potentially tax retirees and target income groups of their choosing.
The proposed amendment would end Illinois’ longstanding flat income tax. Supporters claim it would relieve property tax pressures and boost school funding. But voters statewide rejected progressive tax schemes because they promised to hit retirees, family farms and small businesses hard.
The flat tax makes it painful for state lawmakers to raise taxes, because when they do all taxpayers suffer and hold them responsible at the next election. Killing the flat tax gives lawmakers the power to divide and conquer taxpayers.
Illinois has record spending
The problem is not income but rather spending: Illinois’ budget has grown at an alarming rate. An influx of federal pandemic funds marked for temporary relief allowed lawmakers to add billions into the general funds baseline spending.
Since 2020, Illinois’ annual general funds spending has increased by over $15 billion and is projected to grow another $7 billion by 2029. That would mark a 55% spending increase in just 10 years.
With the state projecting nearly $11 billion in budget deficits through 2029, this level of unchecked spending is unsustainable. That is, unless state lawmakers can force more taxation on Illinoisans.
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