SPRINGFIELD, Ill. (AP) – The Illinois House has approved tiered state income tax rates that would take effect if voters approve switching to a system that hits higher incomes harder.
The House voted 67-48 Thursday to approve the plan by Riverside Democratic Rep. Mike Zalewski. It’s part of Democratic Gov. J.B. Pritzker’s effort to implement what he calls a “fair tax.” The state currently assesses a 4.95% flat rate on all taxpayers.
Republicans denounced the idea. They say it will drive the rich from the state and hurt small businesses.
Voters will decide on whether to jettison the flat-rate structure in a constitutional amendment question in November 2020 after the General Assembly OK’d sending the issue to the ballot. Pritzker campaigned on the issue and contends 97% of Illinoisans would pay no more in taxes because those earning less than $250,000 would pay no more than the current 4.95%.
The rates set in Thursday’s action start at 4.75% for incomes up to $ 10,000. They jump significantly to 7.75% over $250,000 and top out at 7.99% for single filers earning more than $750,000.
The rates would take effect in 2021 with voter approval.
The bill is SB687: www.ilga.gov
Rate structure: https://bit.ly/2vtQwmX