Full House to vote on graduated income tax amendment

  • The full Illinois House could vote to place a constitutional amendment about the state income tax system on the November 2020 ballot.

    The full Illinois House could vote to place a constitutional amendment about the state income tax system on the November 2020 ballot. File photo by The State Journal-Register

By Jerry Nowicki
Capitol News Illinois
Updated 5/20/2019 9:05 PM

SPRINGFIELD -- A constitutional amendment that would allow the state to impose higher tax rates on greater margins of income needs only a vote from the full Illinois House to be brought to voters.

The House Revenue and Finance Committee advanced the measure Monday. Its debate on whether the question should be put on the 2020 election ballot centered largely on a proposed graduated rate structure that was not up for vote.


"Our job is to determine whether or not this is going to work before we put it on the ballot," Rep. Steve Reick, a Woodstock Republican, said at the hearing. "Until these background considerations are answered, I can't give you any kind of consideration toward this."

Representatives from Democratic Gov. J.B. Pritzker's office said they would like to pass a proposed rate structure by the time the Senate Joint Resolution Constitutional Amendment 1 is brought to voters in the 2020 election, but a bill to do so has lagged behind the amendment itself in the House.

All six Republicans on the committee sided with Reick, while all nine Democrats supported the amendment -- even one who had stated publicly he was leaning against voting for a graduated tax amendment.

That legislator is Jonathan Carroll, a Northbrook resident who is widely believed to be a swing vote in the 74-member Democratic House caucus. To be put on the ballot, the amendment, which has already passed the Senate, needs 71 votes in the House.

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"I still have strong reservations on this," Carroll said, calling it "way too important of an issue" not to be brought for a full floor vote. He also said his committee vote does not mean he would necessarily vote for the amendment when it comes before the full House.

The other suburban members of the committee include Democrats Stephanie Kifowit of Oswego and Sam Yingling of Grayslake and Republicans David McSweeney of Barrington Hills and Keith Wheeler of Oswego.

The amendment's House sponsor is Rep. Rob Martwick, a Chicago Democrat who has favored a graduated tax structure for several years, noting it is the "fairest" way to balance structural revenue shortfalls in Illinois.

Martwick said he was told by the Center on Government Forecasting and Accountability that the state would need to bump its 4.95 percent flat tax rate to 6.5 percent to continue to make state-mandated pension and education payments, spend at the rate of inflation and maintain a balanced budget.


"I believe that the worst thing that we do for businesses in this state is the irresponsible manner in which we have run our finances," Martwick said. "The accumulation of debt is constantly putting pressure on income taxes to rise. iI is crowding out our ability to fund programs, which is then pushed off to the local level, which winds up in high property taxes."

Business and anti-tax interests pushed back against the idea that a graduated tax structure would stimulate the state's economy, however.

Orphe Divounguy, chief economist at conservative think tank Illinois Policy Institute, said the graduated tax will not alleviate the main contributors to high property taxes, which are public pension liabilities.

Andrew Libman, president of the Libman Co., a more than 100-year-old business that manufactures cleaning supplies in downstate Arcola, said this action, combined with a recent minimum wage hike, high workers' compensation costs and other state policies, have caused him to take a "serious look" at other states for the first time.

"One thing that's unique about us is that 100 percent of our labor is in the state of Illinois. So we don't have other factories in other states that we can our move manufacturing to if the cost structure does change here," Libman said at a news conference before the committee hearing. "But all of our sales are outside the state, so we're not really competing like a grocery store with a business across the street, or a restaurant. We're competing on a nationwide basis, or a worldwide basis."

The measure could come before the full Illinois House this week. If the amendment were put on the 2020 ballot, it would need support from half of those voting in the election in general or 60 percent of those voting on the specific question.

• Capitol News Illinois reporter Peter Hancock contributed to this report.

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