Illinois state senator pushing progressive tax voters rejected

An Illinois state senator is reviving an effort to change Illinois’ income tax structure from a flat tax, even though voters soundly defeated the change in 2020. Expect higher taxes, retirement taxes if he gets his way.

Illinois state Sen. Robert Martwick wants another shot at adopting a progressive state income tax system.

“If you really believe in something, you don’t give up after one loss,” Martwick said. “It’s the right thing to do.”

Voters rejected the progressive tax system sponsored by Martwick and touted by Gov. J.B. Pritzker in 2020 with 53.3% voting “no.” They wanted to replace the Illinois Constitution’s guarantee of a flat tax, currently set at 4.95% of income, with a progressive system that taxed at different rates for higher income groups, opening the door to taxing retirement income in Illinois.

Martwick hasn’t introduced a bill to put the tax structure back on the ballot, but Illinois Senate President Don Harmon’s office confirmed the two discussed it.

“The idea – the policy – is one the Senate president has long supported,” Harmon’s spokesman said. “At the same time, we all saw the results and the message voters sent.”

Martwick said a revamped “fair tax” must include property tax relief. But a new income tax system doesn’t address the underlying cause for high property taxes: local government pensions, with about $75 billion owed to them.

Pension spending has drained money away from education, social services and other essentials Illinois’ most vulnerable residents rely on.

Paying down the state’s debt is only possible through revenue from tax hikes residents can’t afford or amending the constitution to reduce the growth of future pension liabilities that build debt.

Progressive tax structures ignore the fact it’s easier for higher-income groups to move out of Illinois, adding to the mounting tax burden on the middle class. A new study showed over half of those leaving Illinois made more than $150,000 a year.

Illinoisans already give up more of their income to state and local taxes than anywhere else in the nation.

As chairman of the Illinois Senate’s Pensions Committee, Martwick knows how much debt Illinois is in to its government retirees: $313 billion by one estimate. Lawmakers should be addressing the root cause rather than pushing new taxes.

State lawmakers are desperate to raise more revenue, meaning more taxes. So, they aren’t taking “no” for an answer.