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Time to pay the piper for Illinois; (the "s" is silent)
Topic Started: Jan 12 2011, 06:49 AM (395 Views)
Improviso
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HOLY CARP!!!
Illinois Lawmakers Pass Massive Income Tax Increase. Is California next?

"No state ever taxed its way into prosperity," said State Senator Kirk Dillard. And yet, they continue to try. :doh:

Quote:
 
A big income tax increase squeaked through the Illinois House and Senate as Democratic lawmakers played beat-the-clock to get the measure passed before a new legislative session begins Wednesday.

The bill, which passed the House in a 60-57 vote late on Tuesday and the Senate in a 30-29 vote early on Wednesday, now heads to Governor Pat Quinn, who supports the measure.

The legislation would raise about $6.8 billion a year for the state's beleaguered budget by raising the individual income tax rate temporarily to 5 percent from 3 percent and the corporate tax rate to 7 percent from 4.8 percent.

"We are in desperate need to improve our bond rating and we will do that by raising more money," said Senate President John Cullerton, a Chicago Democrat.

But Republican lawmakers argued against what they called the biggest tax increase in Illinois' history.

"No state ever taxed its way into prosperity," said State Senator Kirk Dillard.

The four-year tax increase would be accompanied by state spending limits through fiscal 2015. For fiscal 2012, which begins on July 1, the limit would be $36.8 billion, which Republican lawmakers contend would mark a 10 percent increase from fiscal 2011 spending levels.

If the state breaches the limit, the higher income tax rates would revert to current levels unless the governor declares a fiscal emergency to raise spending by a set amount for a single fiscal year, according to the legislation.

Revenue from the tax hikes would enable Illinois to sell about $12.2 billion of bonds to pay off a huge bill backlog and make a $3.7 billion pension fund payment for fiscal 2011.

A bill that would authorize $8.75 billion of 15-year general obligation bonds with proceeds earmarked to pay off bills failed to muster enough votes in the House. However, a bill authorizing the sale of $4 billion of taxable pension bonds received final approval.

Illinois, which faces a budget gap that could grow to $15 billion, is one of many U.S. states grappling with record budget deficits after the deep recession stunted tax revenue. It is considered one of the weakest states after years of what critics say was mismanagement of state finances.

Uproar over even bigger tax increases that were floated last week by Democrats who control the legislature led to pared down increases in income tax rates in the final bill.

Various groups condemned the original tax proposal as a job killer that would propel businesses and residents to leave the state. In an opinion piece published in the Chicago Tribune on Tuesday, Caterpillar Inc Chairman and CEO Doug Oberhelman warned the tax increase "will stifle economic growth."

In a floor debate over the tax hike bill, Republican State Representative David Leitch said he was inundated with 1,600 emails against the tax hike with 1,200 or more coming from Caterpillar workers.

Investors, meanwhile, are nervous about Illinois bonds. As a result spreads over Municipal Market Data's triple-A scale have been widening since the beginning of the year for the state's debt, said Domenic Vonella, an MMD analyst. Those spreads are now the widest among all the states.

A fix for Illinois' $52 billion all funds budget that includes nearly $25 billion of general fund spending has been elusive as revenue collections remain lackluster and bills continue to pile up.

The state's inability to pay its bills, while relying on borrowing and other one-time revenue measures, has led to credit rating downgrades. Illinois shares Moody's Investors Service's A1, the lowest among all the states, with California.


Come to Virginia, George. It's a lovely state, with a balanced budget. :D
Identifying narcissists isn't difficult. Just look for the person who is constantly fishing for compliments
and admiration while breaking down over even the slightest bit of criticism.

We have the freedom to choose our actions, but we do not get to choose our consequences.
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jon-nyc
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I'd love to pay just 5% in state income tax.
In my defense, I was left unsupervised.
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Improviso
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jon-nyc
Jan 12 2011, 06:52 AM
I'd love to pay just 5% in state income tax.
Yea, but think of it as the cost of the lovely weather you have there in New York. At least that's the argument that Steve Miller puts forth. :D

Enjoy that 1 foot of snow today. :cool:
Identifying narcissists isn't difficult. Just look for the person who is constantly fishing for compliments
and admiration while breaking down over even the slightest bit of criticism.

We have the freedom to choose our actions, but we do not get to choose our consequences.
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Mark
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Foul, foul government.
___.___
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o 0
When I see an adult on a bicycle, I do not despair for the future of the human race. H.G. Wells
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Improviso
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Mark
Jan 12 2011, 07:06 AM
Foul, foul government.
"They're coming to take you away, ha, ha!"
Identifying narcissists isn't difficult. Just look for the person who is constantly fishing for compliments
and admiration while breaking down over even the slightest bit of criticism.

We have the freedom to choose our actions, but we do not get to choose our consequences.
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jon-nyc
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I bet Mark would consider it good news if his state income tax were reduced to 5%.
In my defense, I was left unsupervised.
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Big John
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come to indiana. Indiana hugs the Chicago city limits at its northwest tip.

Taxes are low, sales tax is low and nonexistent for most food items, gas tax is low, income tax is low, and the state recently passed a 1% cap on property taxes (1% of assessed value max for owner-occupied property) and that doesn't even include exemptions. Even with the decreased revenue, the state is still more or less operating in the black.

Downsides are that they don't salt roads much, don't plow much, sometimes let the grass grow a little long etc and licence plates are expensive, but it's not a bad state.

Oh and the other downside is that there is no income tax reciprocity with Illinois but that's mostly Illinois' doing.





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plays88keys
Pisa-Carp
I'm all for having George and Mrs. George move to Virginia. George, if the tax thing doesn't sell it for the Mrs., how about this? Virginia is for (horse) Lovers
You can never get enough of what you don't need to make you happy.
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jon-nyc
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Income taxes are higher in Virginia than they will be in Illinois after the increase.

In my defense, I was left unsupervised.
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Horace
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HOLY CARP!!!
My income taxes are twice what Illinois would be after this increase.
As a good person, I implore you to do as I, a good person, do. Be good. Do NOT be bad. If you see bad, end bad. End it in yourself, and end it in others. By any means necessary, the good must conquer the bad. Good people know this. Do you know this? Are you good?
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kenny
HOLY CARP!!!
Do states with lower income tax generally have higher property taxes?
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Kincaid
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I don't know. Oregon has no sales tax and across the river in Washington, they have no income tax.
Edited by Kincaid, Jan 12 2011, 02:01 PM.
Kincaid - disgusted Republican Partisan since 2006.
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Big John
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kinkaid: no one ever adequately explained to me why the net price of cigarettes, and many shopping items was actually higher in oregon. they caled it "impounds" or costs added to wholesale. ever heard that term?





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Steve Miller
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Improviso
Jan 12 2011, 06:49 AM
"No state ever taxed its way into prosperity," said State Senator Kirk Dillard. And yet, they continue to try. :doh:


Perhaps not, but have you ever noticed that the most prosperous states are the ones with the highest taxes?
Wag more
Bark less
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jon-nyc
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Improviso
Jan 12 2011, 06:49 AM
"No state ever taxed its way into prosperity," said State Senator Kirk Dillard.
Yeah, and no one ever sloganeered their way out of a fiscal crisis.
In my defense, I was left unsupervised.
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Horace
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jon-nyc
Jan 12 2011, 05:58 PM
Improviso
Jan 12 2011, 06:49 AM
"No state ever taxed its way into prosperity," said State Senator Kirk Dillard.
Yeah, and no one ever sloganeered their way out of a fiscal crisis.
Surely we had a bunch of nice slogans to get our war machine in gear for ww2!

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As a good person, I implore you to do as I, a good person, do. Be good. Do NOT be bad. If you see bad, end bad. End it in yourself, and end it in others. By any means necessary, the good must conquer the bad. Good people know this. Do you know this? Are you good?
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Jolly
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Geaux Tigers!
Y'all hush.

We can use the jobs....
The main obstacle to a stable and just world order is the United States.- George Soros
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Luke's Dad
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plays88keys
Jan 12 2011, 12:46 PM
I'm all for having George and Mrs. George move to Virginia. George, if the tax thing doesn't sell it for the Mrs., how about this? Virginia is for (horse) Lovers
Virginia is for Paul Pelosi?
The problem with having an open mind is that people keep trying to put things in it.
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Luke's Dad
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jon-nyc
Jan 12 2011, 12:56 PM
Income taxes are higher in Virginia than they will be in Illinois after the increase.

And 2-3% higher sales tax rates.
The problem with having an open mind is that people keep trying to put things in it.
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