The Chicago Tribune reported today:
Gov. Pat Quinn is considering raising the Illinois income tax by 50 percent in a politically risky bid to address one of the biggest budget dilemmas in state history, sources said Thursday. An increase to 4.5 percent from the current 3 percent tax rate on individuals would include a corresponding hike in the corporate income tax on businesses, according to sources familiar with the new governor's preparations for his first budget address Wednesday.
(Other politicians are looking to jack up the state’s gas tax – another bad idea.)
What would be the result of increasing the income tax? Well, one of the few competitive advantages that Illinois now possesses – a relatively low personal income tax rate – would be wiped out.
The state’s current ranking on SBE Council’s “Small Business Survival Index,” which ranks the states according to their public policy climates for small business and entrepreneurship, is 24th among the 50 states and District of Columbia. An income tax increase would push Illinois down among the least competitive states.
Raymond J. Keating
Chief Economist
Small Business & Entrepreneurship Council
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