Saturday, January 15, 2011

Illinois lawmakers approve largest tax increase in state history

The Illinois legislature voted to hike the state’s income tax by 66 percent Wednesday. After kicking the spending budget problem down the road for a long time, Illinois was left with hard decisions about how to close its $15 billion spending budget deficit. The Illinois income tax increase, the largest in the state’s history, is a desperate step to solve spending budget woes many other states with a similar problem continue to stay away from. {Illinois is trying their hardest to stay away from installment loans|The state is trying their hardest to stay frompayday advance loans.

All about the Illinois tax increases

A state is able to work on its budget quite a bit with the tax increase in Illinois. There is a temporary income tax increase from 3 to 5 percent in Illinois. Spending increases will be limited to 2 percent as well.Right before the new Illinois General Assembly was sworn in at noon, the bill was passed even though Republicans said they'd never vote on the measure. Because of the last election, Illinois is losing a ton of Democrats which means majority is changing. Now, legislators who don't support the Illinois tax increases are going to be in charge.

The way to work on the Illinois budget crisis

Many republican lawmakers said no to proposed taxes while now the Illinois income tax increase was passed. A $1-a-pack increase in cigarette taxes to fund school districts didn’t fly. It was also not accepted for taxes to help pay off the $8.7 billion installment loan. The businesses waiting to get paid would be what the loan was used for. Social service agencies would also see some of the money. Democratic Governor Pat Quinn’s office said the Illinois tax increase will raise $6.8 billion a year. There will also be a 2 percent cap on spending growth. Reaching that limit would mean the end of the Illinois tax increase. That was part of the agreement.

All about the Illinois tax increase effect

The largest tax increase in the state's history is about to happen with an increase to 5 percent with the Illinois income tax increase. Other Midwestern states have higher taxes still. Neighboring Iowa’s income tax rate is 6.4 percent, Missouri’s is 6 percent, and Wisconsin’s is 7.5 percent. Many that used to pay $1,000 now pay $1,666 with the tax increase in the state's income tax. Then there will be a drop in 2015. This means the rate will go to $1,333 or to 4 percent. The additional tax revenue will balance the state’s budget, but Republicans call it a job-killing hoax that will become permanent.

Information from

Associated Press

news.yahoo.com/s/ap/20110112/ap_on_bi_ge/us_illinois_taxes

Fox News

foxnews.com/politics/2011/01/12/ill-lawmakers-pass-percent-income-tax-increase/

Reuters

reuters.com/article/idUSTRE70A6GP20110112



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