NEW 2013 NEWS FIRST:
October 2013:
Illinois/Will County Illinois Business & Tax Climate:
The Wall Street Journal Reports 8/20/13:
"Washington finally declared a truce on the death tax this year, with estates now taxed at 40%. Now the death-tax debate has shifted to state capitals, with mixed results depending on which party runs the state. Prior to 2001, states could impose an estate tax of up to 16% with no extra burden on their residents because a federal tax credit offset state estate taxes. That policy has ended and now state death levies are paid out of the assets of the deceased. Four states—Indiana, North Carolina, Ohio and Tennessee—have reacted wisely by eliminating or phasing out their estate taxes. This leaves 18 states plus the District of Columbia that still impose a gift or estate levy." As you can see, this is the effect that Former Rep. Jack McGuire (D-IL Dist.86) and Larry Walsh Jr. (D-IL Dist.86) have on our families, our taxes, and our economy... Can you afford more in 2014 & 2016?
[1] January 30, 2013 (as reported by Chicago Magazine) ... Illinois has the 4th most regressive tax systems amongst the states:
It's above average for the middle class, as well: the national average for the middle 60 percent is 9.4 percent, so Illinois is 1.7 percent above the national average. Only Arkansas (11.2 percent), Hawaii (11.3 percent), and New York (11.2 percent) tax the middle class at higher rates than Illinois.
Illinois' property taxes as a share of income—which includes property taxes passed on as rent—is one of the highest in the country. Connecticut's is higher on the very poor and the middle class; New York's is higher on the very poor; Vermont is higher on the lower-middle and very-middle classes; New Hampshire and New Jersey are higher across the board. But all those states have progressive income taxes but New Hampshire, which has no income tax and a much lower sales-tax burden.
[2] Illinois Taxpayers worked 115 days into 2013 to Pay Their Taxes!
[3] Your Property Tax Bills Are Coming in May of 2013! Are You Prepared?
According to Bloomberg News 2/28/13:
"S&P downgraded Illinois Jan. 25 to A-, six steps below AAA, after lawmakers were unable to produce a plan to shore up the state’s pensions, which have just 39 percent of assets needed to cover projected obligations. The state of about 13 million delayed a general-obligation sale five days later.
Illinois legislators have proposed changes to the state’s pension systems, including a bill to make the 2011 income-tax increase permanent."
According to the Tax Foundation, Illinois’ per capita (per household) state and local tax burden averaged 10.0% of income in 2009, which was slightly above the U.S. average of 9.8%. The Tax Foundation reported that the Illinois state and local tax burden was $4,596 per capita annually.
 |
Click The Image (Above) To Enlarge
|
In addition, with the advent of the tax increases levied by some Illinois law makers (in January of 2011 (SB2505)), which was voted YES by the former District 86 Representative - Jack McGuire (and reinforced by newly elected House Rep. Larry Walsh Jr.), it placed Illinois as amongst the top of the list of States which have the HIGHEST Corporate Tax rates.
The bill, SB2505, passed in January of 2011 which effectively increased personal income taxes to the tune of 67%.
The "Repeal The Tax Hike" Website Says:
The average family in Illinois will pay around $1,480 more per year in taxes. Here are some of the things you and your family could do with $1,480:
1. Your family of four could eat for 10 weeks.
2. Your family could clothe two kids for nearly two years.
3. Your family could heat its home for two and a half years.
4. You could ride to work on public transportation for nearly a year and a half.
5. You could fill your car with gas more than 25 times.
6. You could pay your cell phone bill for more than two years.
Included in SB2505, the former (Joliet) Representative raised the Corporate Tax Rate from 4.8% to 7%, making Illinois amongst one of the highest corporate taxes in the Nation and even higher than other countries across the world.
SmartMoney.Com Reported Concerning The State of Illinois' High Corporate Tax Rate:
"The tax increase will “severely impact” the state’s attractiveness to business, warned the Tax Foundation’s director of state projects, Joseph Henchman, and staff economist, Kail Padgitt."
IN ADDITION:
Illinois also imposes a “personal property tax replacement tax” of 2.5% on top of the base corporate income tax rate, thus making the combined rate as applied to corporations of: 9.5% for tax years 2011-2014.
December 21, 2011, The Associated Press Reported:
"A study of moving patterns by United Van Lines shows that Illinois and New Jersey are tops in outbound migrations. There's a difference between the two states: New Jersey's governor, Republican Chris Christie, is reversing the rot. Governor Pat Quinn, Rod Blagojevich's two-time running mate, socked Illinois taxpayers with massive income tax increases."
According To The 2012-2013 United Van Lines Report, the top-five outbound states for 2012 were:
"A spokeswoman for the United Van Lines company told CBS St. Louis that over 60 percent of the company's business in Illinois involved individuals or businesses who were leaving the state. She described that number as pretty big."
LESS ILLINOIS RESIDENTS AND HIGHER TAX LEVIES = A HIGHER TAX BURDEN SHOULDERED BY INDIVIDUAL TAXPAYERS AND ILLINOIS' 1.1-MILLION SMALL BUSINESSES AND MAJOR CORPORATION IN ILLINOIS!"A study of moving patterns by United Van Lines shows that Illinois and New Jersey are tops in outbound migrations. There's a difference between the two states: New Jersey's governor, Republican Chris Christie, is reversing the rot. Governor Pat Quinn, Rod Blagojevich's two-time running mate, socked Illinois taxpayers with massive income tax increases."
- New Jersey
- Illinois
- West Virginia
- New York
- New Mexico
"A spokeswoman for the United Van Lines company told CBS St. Louis that over 60 percent of the company's business in Illinois involved individuals or businesses who were leaving the state. She described that number as pretty big."
Chicago Tribune reported on 1/12/12:
"In 2009, the most recent year in which this number is available from the U.S. Census Bureau, the median income of a household based in Illinois was roughly $54,000. The average size of an Illinois household was roughly 3 people. This average Illinois family paid $1,000 more in Illinois income taxes in 2011, at a time when increasing prices in gas, groceries, other taxes and general costs of living were also hitting resident’s wallets hard."
Illinois Rep. Tom Morrison said: "According to Illinois’ Commission on Government Forecasting and Accountability (CFGA) reported that SB 2505 revenues have not met the January 2011 expectations. Net new revenues during (July 2011-December 2011) in the areas of individual income tax receipts, corporate income tax receipts, and estate tax receipts show that these three taxes brought in net new revenue during this period of $2.996 billion, equivalent to $5.992 billion for a full 12-month period. This was a shortfall of $1.086 billion from expectations."
The Heritage Foundation's economic experts J.D. Foster and Curtis Dubay point out in their economic research paper that [with higher corporate tax rates]:
"not only will companies struggle to compete abroad, the domestic production in the U.S. will fall as well. The bottom line is that additional taxes hurt, costing jobs and opportunity – a high price to pay for government’s wasteful spending."
"not only will companies struggle to compete abroad, the domestic production in the U.S. will fall as well. The bottom line is that additional taxes hurt, costing jobs and opportunity – a high price to pay for government’s wasteful spending."
An About.Com report on Taxes reveals the following:
"[1] Productivity declines as the tax rate increases, as people choose to work less. The higher the tax rate, the more time people spend evading taxes and the less time they spend on more productive activity. So the lower the tax rate, the higher the value of all the goods and services produced.
[2] Government tax revenue does not necessarily increase as the tax rate increases. The government will earn more tax income at 1% rate than at 0%, but they will not earn more at 100% than they will at 10%, due to the disincentives high tax rates cause. Thus there is a peak tax rate where government revenue is highest."
SOLUTION: CUT TAXES:
An economic research paper (The Dynamic Effects of Personal and Corporate Income Tax Changes - March 2012), states the following:
"Cuts in personal income taxes boost employment and do so relatively quickly. A one percentage point decrease in taxes leads to a statistically significant rise in employment per capita of 0.3 percent on impact. The employment response peaks at around 0.8 percent five quarters after the tax stimulus."
"Cuts in personal income taxes boost employment and do so relatively quickly. A one percentage point decrease in taxes leads to a statistically significant rise in employment per capita of 0.3 percent on impact. The employment response peaks at around 0.8 percent five quarters after the tax stimulus."
In addition, the report states that in cutting the Corporate Tax Rate it will give "considerable and significant immediate increase in output" and will create "a gradual rise in employment."
TAKEN ALL TOGETHER:
Taken all the factors discussed above: (1) the McGuire/Walsh-Jr. tax increases don't meet the level expected or promised; (2) Higher taxes hurt jobs and stifle economic opportunities; (3) Higher taxes do not necessarily mean higher revenues for the government to meet their spending and budgetary needs; and (4) Lowering taxes actually increases employment and corporate output (which in-turn can actually increase the revenues the State receives in tax receipts).
