Progressive tax proposal would mean as much as a $600 tax hike for typical Metro East family
Though some politicians claim a progressive income tax would only affect the rich, rates established under House Bill 3522 would raise income taxes on middle-class families.
Though often billed as a “tax on the rich,” median-income families in Metro East’s Madison and St. Clair counties would see their income taxes increased as much as $617 under a new progressive tax proposal in Springfield.
House Bill 3522, filed by state Rep. Robert Martwick, D-Chicago, puts forth a graduated, or “progressive” income tax structure with the following rates:
- 4 percent for income between $0-$7,500
- 5.84 percent for income between $7,500-$15,000
- 6.27 percent for income between $15,000-$225,000
- 7.65 percent for income above $225,000
For a median-income family with two kids in Madison County, the new rates would mean a $617 tax hike. The same family in St. Clair County would see a $554 tax hike. Intensifying the tax burden for families in this area could push them out for greener pastures – a trend the Metro East has already been seeing.
From July 2016 to July 2017, on net, more than 1,300 people moved out of St. Clair County to other counties. And nearly 400 more people on net moved out of Madison County to other counties.
And while both counties saw natural population gains from births outpacing deaths – and gained from international migration as well – the large losses in domestic migration offset those gains and caused both counties’ populations to dip. St. Clair County’s population decreased by 641 people, while Madison County’s dropped by 170 people. Outmigration to other counties is a continuing trend in the Metro East region – from 2010-2017, more than 22,000 on net left both counties combined.
Alleviating the tax burden Metro East taxpayers are faced with would be a good way to retain residents. Instead, Martwick’s plan does the opposite, placing an additional cost on residents in a region with already dramatically slow income growth. HB 3522 is not what the Metro East – or the state as a whole – need.