This November, Illinois voters need to vote yes and pass the Fair Tax Amendment. It’s the only way to bring tax fairness to Illinois and ensure we have resources to invest in our workforce and our communities.
The Fair Tax will mean lower taxes for the majority of Illinoisans while bringing billions of dollars of investment to local communities. Despite the promises, flat income taxes like our current system undermine equity and don’t adequately fund the services we all depend on. Illinois is one of the few states to use a flat tax, rather than graduated income tax rates, where those with higher incomes pay higher rates and lower incomes pay lower rates. It’s time for that to change–we at the Chicago Jobs Council strongly support the Fair Tax Amendment. With the new tax structure, income taxes would go down or stay the same for 97% of Illinoisans. Income taxes would only go up for those making over $250,000 each year.
The Fair Tax is also good for the Illinois State Budget as a whole. The Governor’s proposed rates would increase General Fund revenues by approximately $3.1 billion each year. And in forecasts of next year’s budget after COVID-19, the amendment would reduce the shortfall by $1.2 billion. Without this revenue, social services and workforce development programs have no hope to meet the needs of our communities.
Without a Fair Tax, the need for a balanced budget has led the State to slash funding on most public services. Policymakers are stuck defending spending on basic public services, leaving no capacity for innovative programs or investment in workforce development. Less than 5% of public workforce development spending comes from the State. Instead, the vast majority is pass-through federal dollars which are subject to numerous restrictions. Federal programs like WIOA provide solid foundations for workforce development but since there are nationwide regulations and restrictions, Illinois cannot fully adapt their programs to its labor force and unique economic environment. Increased revenues could enable Illinois to design and implement more responsive workforce development programs.
Shifting to a Fair Tax would also allow Illinois to rely less on punitive, regressive tickets, fines, and fees for revenue, something a number of Illinois cities are guilty of. In the past decade, we’ve seen repeated evidence that fines and fees have disproportionately fallen on People of Color and low-income communities. The burdens imposed by these fines present new obstacles for already-marginalized communities, like loss of a driver’s license, which frequently leads to job loss and thus reduced ability to pay these debts. Unlike aggressive tickets, fines, and fees, the Fair Tax is part of a sustainable finance plan for state and local government.
During the current pandemic and record unemployment rates, this tax cut from the Fair Tax will be particularly helpful. Many of our essential frontline workers make under $100,000, so this is a great way to put more money in their pockets. Staying home isn’t the only way to support them, we can also vote yes.
Finally, the Fair Tax will also help spur our economic recovery coming out of the pandemic. For one thing, employment growth is driven by tax cuts for lower-income groups, not the top 10%. Low and middle income families spend a greater percentage of their income, so more money in their hands is more money back into the economy. Let’s put Illinois on track and vote yes for a Fair Tax in November.