This Just In…Fair Tax Plan Introduced

Submitted on Fri, 04/15/2016 - 13:27

 

LouLang_300_0.jpgIllinois House Deputy Majority Leader Lou Lang introduced a tax plan today that would be contingent on voters approving a constitutional amendment allowing a graduated income tax (aka a "Fair Tax"). It would raise $1.9 billion to stop further cuts to families, communities, and small businesses. It would also cut taxes for 99% of Illinois families.

The Responsible Budget Coalition support SJRCA 1, an amendment that would allow voters to amend the Illinois Constitution to allow a Fair Tax. A Fair Tax is one with lower tax rates for lower incomes and higher rates for higher incomes. 

The Fiscal Policy Center at Voices for Illinois Children, an RBC member, has produced a factsheet on the bill.  Click here to view it.

via Capitol Fax...

* The bill, Rep. Lou Lang’s HB 689, would take effect if voters approve a constitutional amendment allowing a graduated income tax

(A) for taxpayers who are married filing a joint return or head of household:

                        (i) an amount equal to 3.5% of the portion of the taxpayer’s net income for the taxable year that is                                     $200,000 or less;

(ii) an amount equal to 3.75% of the portion of the taxpayer’s net income for the taxable year that is more than $200,000 but not more than $750,000;

(iii) an amount equal to 8.75% of the portion of the taxpayer’s net income for the taxable year that is more than $750,000 but not more than $1,500,000; and

(iv) an amount equal to 9.75% of the portion of the taxpayer’s net income for the taxable year that is more than $1,500,000; and

(B) for all other taxpayers:

                        (i) an amount equal to 3.5% of the portion of the taxpayer’s net income for the taxable year that is                                     $100,000 or less;

(ii) an amount equal to 3.75% of the portion of the taxpayer’s net income for the taxable year that is more than $100,000 but not more than $500,000;

(iii) an amount equal to 8.75% of the portion of the taxpayer’s net income for the taxable year that is more than $500,000 but not more than $1,000,000; and

(iv) an amount equal to 9.75% of the portion of the taxpayer’s net income for the taxable year that is more than $1,000,000.

*** UPDATE ***  From Emily Miller…

Hi Rich,

I noticed that you posted about the new fair tax proposal introduced by Leader Lang. This proposal is the result of years of negotiations and hard work. The bill introduced reflects feedback and input from members on both sides of the aisle, and should be viewed as an opportunity for lawmakers and the Governor to come together to reform our outdated tax code.

Most notably, the measure provides a tax cut for over 99% of Illinois taxpayers and provides $1.9 billion in new revenue to restore cuts to vital services.

Attached is a fact sheet from Voices for Illinois Children to help folks understand the impact of a fair tax on children and families in Illinois.

Thanks.

Emily Miller
Voices for Illinois Children

Attachment...

 

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Here's a press release about HB 689 from Leader Lang...

Illinois House Deputy Majority Leader Lou Lang (D-Skokie) on Friday filed legislation, House Bill 689, that would reform the Illinois tax code, providing a tax cut to 99% of Illinois taxpayers while raising an additional $1.9 billion dollars to help fund essential state services.

Illinois is well into its tenth month without a budget, and while lawmakers and the Governor have long recognized the need for new revenue to invest in children, families and communities, our outdated tax laws mean that we cannot raise new revenue without raising taxes on those least able to afford it, Lang says.

“We don’t have to stay stuck in the past. There is another path forward that puts tax dollars back in the hands of hardworking families and eases the pain caused by recent budget cuts,” said Lang. “When my bill passes and the governor signs it, ninety-nine percent of taxpayers will get a tax cut.”

Lang’s bill works in tandem with State Rep. Christian Mitchell’s (D-Chicago) Constitutional Amendment resolution, HJRCA-59, which would allow Illinois voters to choose to reform our tax code by voting for fair tax where lower rates apply to lower incomes and higher rates apply to higher incomes.

Illinois is one of only a handful of states that has a flat income tax, which forces middle class families to carry the majority of the tax load. When Illinois amends its constitution to allow for a fair tax, the General Assembly will no longer be forced to raise taxes on the hard-working middle class families who can least afford it, Mitchell argues.

“The Fair Tax, where lower rates would apply to lower incomes and higher rates would apply to higher incomes, is long over due in our state. It is fundamentally unfair that our tax rate is the same no matter if you are a minimum wage worker or a millionaire, ” said Mitchell. “With a Fair Tax, we can provide tax relief for ninety-nine perfect of taxpayers, and reform our outdated tax code.”

State Senator Don Harmon (D-Oak Park), who is Chief Sponsor of the Fair Tax in the Senate welcomed the move by Lang.

“I’m delighted to work with Leader Lang and Representative Mitchell to help cut taxes on working families,” Harmon said. “We offer this as a serious solution to moving our state forward and we hope that our colleagues on the other side of the aisle will join us in effort to make our state more fair and to help provide revenue to the vital services we all care deeply about.”