7.5.19

ILLINOIS IS A TAX HELL.

The current (need I specify Democrat) governor would like to introduce a graduated income tax, and his willing accomplices are buying advertising suggesting, inter alia, that higher income people are paying a smaller share of their income in taxes than are lower income people.  That is likely true, but it is not the Illinois flat tax at work.  Rather, it is all the consumption taxes, user fees, tolls (if anybody works out the incidence thereof) and property taxes that residents pay, directly every time they buy food or place a 'phone call, or indirectly through their rents.  Homeowners pay the property tax directly, in DeKalb County that comes at the beginning of June and the beginning of September.

The "Cheddar Curtain" at the Wisconsin border is metaphorical, not physical, and yet, people have been migrating out of Illinois for some time.  It's beginning to concentrate minds, even among the tax-and-spend set.
Statewide population totals also have been on the decline since July 2013, according to census data, although Illinois remains the most populous state in the Midwest with about 12.7 million people.

“The people that have talked to me about wanting to move, some of them have just lost hope in the ability of the state government to properly function,” [DeKalb county board chairman Mark] Pietrowski said Friday. “Some of that isn’t helped by two years of not being able to pass a budget.”

One factor stimulating this exodus is the state’s high property tax burden on residents.
That's kind of an awkward transition, a heavily Chicago Democrat state legislature butted heads with an intransigent Republican governor in a most unedifying way. (Thanks, Madigan!)

Although property tax relief might do something to keep some residents in the state, it's unlikely that a higher income tax rate is going to finance that.
Pietrowski said there needs to be a greater emphasis on income tax rather than property taxes.

“One of the major reasons why people are not choosing to come to Illinois is they see a house but they have to pay more property taxes,” Pietrowski said. “If we could get that lowered, our state is going to look more attractive, because we do have a lot of things going for us: access to jobs, plenty of access to neighboring cities. Illinois is still one of the No. 1 manufacturing states in the nation.”

DeKalb County is a tax cap county, which Pietrowski said can be a hindrance on local governing bodies seeking to lower property taxes.

The Property Tax Extension Limitation Law, commonly referred to as “tax caps” does not limit individual property taxes or property bills, according to the University of Illinois Extension. Instead, a tax cap is meant to limit the amount municipalities can levy when property values and assessments grow faster than the rate of inflation.

“It changes the local government’s ability to [lower property taxes] because it maximizes what you can increase,” Pietrowski said. “If you do decrease, it actually ends up penalizing you, so you can never make that money back.”
That depends on elasticities. If you decrease, you might not have to make the money back, because the tax base gets bigger. On the other hand, if you're a public official, your salary depends on all that income belonging to the government.

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