Illinois income taxes won't be going down anytime soon if Governor Pat Quinn gets his way. Quinn's new budget plan would make a recent income tax hike permanent - instead of allowing tax rates to drop next year. One reason is because Quinn says wants to put more money in homeowners' pockets. But as IPR's Alex Keefe reports, that part of his plan could leave out many renters
The big, bitter pill in Quinn's budget is this: keeping the state's personal income tax rate at five percent next year - instead of letting it drop down to 3-and-3-quarters percent. But the Democratic governor also offered some sugar in last week's budget speech:
QUINN: Providing every homeowner in Illinois with a guaranteed $500 property tax refund every year. "Every homeowner...guaranteed 5-hundred dollars...every year..."
That might sound pretty sweet for the 92 percent of Illinois homeowners Quinn says would benefit from that refund. But all you apartment-dwellers out there?
MSALL: Renters are not going to share in any of the give-backs in terms of the property tax rebate.
Laurence Msall heads up the Chicago-based Civic Federation - a budget watchdog group. And he points out Illinois' property tax credit does NOT apply to renters - even though they do pay for property taxes indirectly each time they cut their landlords a check. That means a third of Illinois households - and more than half of Chicago's - aren't eligible. And yet...
MSALL: The overall population - everyone at every level who earns income - is gonna pay a higher tax rate going forward, than they would otherwise, if the temporary income tax were allowed to expire.
If approved, the 500-dollar refunds would cost nearly 1-point-three billion dollars next year - more than twice as much as the current program. Quinn says it's part of his larger plan to give homeowners and working families some relief from an onerous, unfair property tax system. But if that's how he feels, renters should be included too, says John Bartlett, who heads up the Metropolitan Tenants Organization - a Chicago renters rights group.
BARTLETT: Renters tend to be the lowest-income population in Illinois, and they're not gonna be getting a tax break, and that's really unfortunate and unfair because they probably need it the most.
But Quinn points to the state's Earned Income Tax Credit for the working poor. It's for individuals who make less than about 14-thousand dollars a year - or less than 48-thousand dollars for a family of four. And over the next five years, Quinn wants to DOUBLE that tax credit.
QUINN: There are many, many renters who would benefit from that particular tax relief measure. Uh, we've already done it once. We're gonna do it again. We're gonna double the value of the Earned Income Tax Credit which helps so many renting families raising children."
But that would only apply to about a quarter of Illinois' rental households, according to Census data. University of Illinois Professor David Merriman says that leaves middle-class renters in the lurch.
in the 40, 50, 60-thousand dollar range and are renters - those are the people who I think are gonna get hit the hardest.
Quinn's administration points out it doesn't want to RAISE the current income tax rate next year. But it's also not LOWERING it - as was the original plan. Kevin Jackson, who heads up the Chicago Rehab Network, says that's especially bad news right now - as rents in Illinois are already becoming less and less affordable.
JACKSON: Renters are a vibrant and significant part of the economy. And so if we're thinking about this homeowner support as a way of reinforcing economic activity, renters should also be included.
Twenty-two other states do include renters in some sort of tax benefit program. Governor Quinn would NOT say whether he'd seriously consider adding Illinois to that list.
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