Working people in Illinois deserve a fairer state income tax
Coston Plummer is a home-care worker on the South Side. He makes $11 an hour.
The work he does is draining, mentally and physically, and he wonders why the state can’t pay more. He wonders, actually, how long the state will continue to pay at all.
The State of Illinois has a miserable record of paying for social services in a timely manner, and even now the state’s backlog of bills is $8.1 billion.
At a rainy day rally in the Loop on Tuesday, Plummer was among a dozen speakers calling for Illinois to switch to a graduated income tax, dumping the current flat tax, a change that would require an amendment to the state Constitution. Plummer’s not much on public speaking, but he sees a direct connection between how taxes are paid in Illinois and how ordinary working people get by — or don’t — and he wanted to have his say.
“They don’t respect us,” he said, speaking of the politicians, beginning with Gov. Bruce Rauner, who would allow essential social services to dry up rather than reform the state’s unfair system of taxation. “They act like we don’t do real work.”
You’ll hear a lot of arguments for or against a graduated income tax — the notion that wealthier people should pay taxes at a higher percentage — but the difference of opinion really does boil down to that. You either quake at the thought of taxing the rich one penny more, for fear they’ll take their bat and ball and find a new game elsewhere — Wisconsin, perhaps, or Florida.
Or you take the view, as we do, that working people increasingly are undervalued in our society and, as part of setting things right, the wealthiest people should pay a fairer share of taxes.
Plummer recalled going grocery shopping recently, just picking up some basics, and realizing when he got to the cash register that he couldn’t afford it all. He had to put a few items back.
“I work every day,” he said. “Why do I have to put food back? How does this possibly make sense?”
Illinois’ flat income tax — one that charges the same rate no matter how much money someone earns — hits taxpayers at the low end extra hard because they must spend a larger share of their income on necessities, such as rent and food and diapers for the baby. Lower-income folks also are hit hard by other levies, such as sales taxes and payroll taxes. Add it all up, and the percentage of income a working woman or man pays in overall taxes is much higher than the percentage paid by a wealthy person.
In contrast, a graduated or progressive income tax takes a higher percentage from people in the upper ranges of the income scale. That’s how the federal income tax is structured. A Lake Forest lawyer, for example, pays a higher percentage of his income in taxes than a Logan Square barista. Thirty-four states also use a graduated income tax.
A flat tax was a bad idea in 1970 when it was locked in by a new state Constitution, but it’s grown only worse. The richest 1 percent of Americans at that time held about 10 percent of the nation’s wealth. But our nation’s wealth gap has grown tremendously since, with the richest 1 percent of us now holding more than 38 percent of the wealth. As the wealth gap has grown, so has the unfairness of the flat tax.
Conservatives argue that the solution to Illinois’ debt problems is to slash expenses, but they’re talking through their hats. The cuts would have to be draconian and, even then, the state’s structural financial problems, such as the long-term cost of pension obligations, would not be solved. Should Illinois shut down prisons? Close nursing homes and throw the elderly to the curb? Ignore the growing opioid addiction crisis?
The unavoidable truth is that Illinois must generate more revenue to dig itself out of its financial hole once and for all. And the most stable and fair source of that extra revenue would be a graduated income tax.
A broad coalition of several hundred community groups, labor unions and social service agencies — the Responsible Budget Coalition — is working to put on the November ballot a proposed amendment to the state Constitution to allow for a graduated income tax. We strongly support the referendum and hope that you will as well, but its prospects are not good.
To get the amendment on the ballot, 60 percent of the legislators in both the state House and Senate must approve it by May 8, and that means at least four Republicans in the House — in addition to every Democrat — will have to sign on. But Rauner has made his opposition to a graduated income tax clear, and it’s hard to see where those votes will come from.
This is where you come in. Let your voice be heard. And vote in November accordingly.
A graduated income tax — as common in red states as in blue states — is not a liberal idea or conservative idea. It’s really just fair.
CHICAGO SUN-TIMES EDITORIAL BOARD, MARCH 28, 2018