No country for income tax hikes
Normally, a tax hike would be the last thing that state legislators would consider in an election year. Tax increases usually are approved in "off years" to give voters time to forget before they vote. So, you'd think that any talk of a large income tax increase in Springfield would be the last thing being considered. But the ever-growing likelihood that U.S. Sen. Barack Obama may very well end up as the presidential nominee is giving Illinois Democrats hope that his presence at the top of the ticket will negate any voter negativity associated with just about anything they do this year. And one of the controversial items on the agenda for some of those Democrats is an income tax increase.
A spokesperson for Senate President Emil Jones confirmed last week that Jones once again is supporting an income tax hike.
Last year at this time, Jones joked with reporters that while Sen. James Meeks' income tax hike proposal wasn't exactly dead, Jones would be assigning it to the "Hospice Committee" and wouldn't allow a floor vote on the bill. Jones had long supported an income tax hike for school funding and property tax relief, but he abandoned that position last year in favor of the governor's gross receipts tax - which never went anywhere - and adamantly refused to budge.
Jones' refusal to even consider the income tax hike bill (SB 750) was roundly criticized by many of his own members and was one of the many factors that drove a deep wedge in his caucus last year. The Senate leader's opposition doomed what many had considered the tax hike's best chance of passage in a decade. The 2008 election still was far away, business leaders were desperate to sign on to an alternative in the face of the looming gross receipts tax, and even many Republicans were quietly signaling a willingness to consider the proposal.
Earlier this month, Sen. Meeks quietly introduced a new income tax hike bill, SB 2288. The proposal would raise money not only for schools and property tax relief, but also fund a capital construction bill for roads, bridges, schools and mass transit. Unlike last year's version, the new proposal would not slam newspapers with a tax increase on ink and newsprint, and it stays away from a controversial service tax.
Meeks said last week that he had discussed his new proposal with Jones, but wouldn't say whether his leader specifically supports the bill. Sen. Meeks opposes a casino gambling expansion proposal to fund the capital bill, and he said that serious problems remain in passing such a plan, so Jones may be open to an alternative. Jones pushed harder for a gaming expansion plan last year than anything else - it was one of the few "big" pieces of legislation that he convinced his hopelessly divided caucus to support. But last week, Jones said an income tax hike could pay for the capital plan.
Meeks and others seem hopeful that some sort of arrangement can be made with Gov. Blagojevich, now that the governor has broken his campaign promise with the mass transit bailout to never sign a tax hike on "people." One income tax hike supporter, Sen. John Cullerton, who is a co-sponsor of the new bill, has been joking for the past few days that he would deliberately insert some typos into an income tax hike bill so the governor could use his amendatory veto powers and therefore claim he never "signed" it into law. The governor used those same powers on the mass transit bailout bill to give senior citizens free rides, while claiming he never actually signed the sales tax increase into law.
A spokesman for House Speaker Michael Madigan said his boss wouldn't want to be the "Lone Ranger" on a tax hike bill, but has talked about how small tax hikes would make more sense for the capital program than gaming. "I would put him down as willing to discuss it," the spokesman said about the speaker.
The governor already has announced his opposition to the Meeks proposal and has said he will veto any income tax hike. Of course, he said the same about the recent sales tax increase, which now is law, so one never knows what the future might bring.
The tax hike still is a long shot, but it's worth keeping an eye on.
