That big bump in the night? It was the sound of a massive new tax increase dropping on the backs of Illinois citizens and businesses.
Not long after midnight, Wednesday morning, mere hours before the newly elected legislature was to be sworn into office, the state’s lame-duck legislature voted to increase the personal income tax by a whopping 67 percent and the business income tax by nearly 50 percent.
That’s lame, all right.
Governor Pat Quinn, who had campaigned in favor of a smaller increase, will sign the bigger tax hike. “Our fiscal house was burning,” he said in its defense.
Is the fire now out?
Well, there sure is a lot of smoke, and where there’s smoke, there’s … a lot of people making a quick exit.
Remember, people can vote with their feet. “Leaving Illinois,” a study by the Illinois Policy Institute, points out that between 1991 and 2009 Illinois lost one resident every ten minutes.
That’s $16.9 billion in lost state and local tax revenue.
So Wisconsin Governor Scott Walker was quick to offer a safer haven. “In these challenging economic times while Illinois is raising taxes, we are lowering them.”
As William Brodsky, chief executive of CBOE Holdings Inc, argues, “Merely throwing tax dollars at a broken system, without overhauling the expense side of the ledger, compounds the problem…” Bemoaning Illinois’ lost tax advantage in attracting business, Brodsky remarked, “They don’t come here for the weather.”
This is Common Sense. I’m Paul Jacob.