CHICAGO – Republican Gov. Bruce Rauner is telling voters that his Democratic opponent, J.B. Pritzker, plans to raise taxes by 26 percent if he’s elected to office.
Rauner, who is seeking a second term this fall, has spent years battling Democrats over how to handle the state’s troubled finances, which are plagued by a $130 billion pension shortfall, the lowest credit rating of any state and billions in unpaid bills. The state’s Legislature increased taxes last year over Rauner’s protests.
Rauner’s ad is the latest attack in a campaign between the two wealthy businessmen, who are on pace to set a record for the most expensive governor’s race in the country.
A closer look at the claim from the Rauner campaign:
RAUNER CAMPAIGN: “[Illinois House Speaker] Mike Madigan just raised your taxes 32 percent over Bruce Rauner’s veto. Now J.B. Pritzker wants to raise your taxes again. Pritzker and Madigan want to raise taxes on every middle class Illinoisan and increase tax rates another 26 percent,” said in a TV ad launched last week.
THE FACTS: Pritzker has not released a specific tax plan, so it’s impossible to say how much he might raise taxes and who might pay more.
Rauner is right that state taxes increased recently. Madigan rallied the statehouse last year to raise the state’s income tax from 3.75 percent to 4.95 percent – a 32 percent jump – against Rauner’s veto. The increase applied to income taxes only, not other taxes collected by the state such as sales tax. Illinois last hiked its sales taxes in 1990.
The additional 26 percent tax increase referenced in Rauner’s ad stems from a failed state bill this year that proposed raising the tax rate again by at least that much for anyone making more than $15,000 a year. When asked, Rauner’s campaign said that figure was used in the ad because it’s the only income tax plan a Democratic lawmaker has presented and Pritzker has not revealed how tax rates will change under his proposal. The Rauner campaign, however, could not provide any examples of Pritzker expressing support for the bill. During a March radio interview, Pritzker called an accusation that his tax plan would be similar to that bill “false.”
“JB does not support the bill referenced in Rauner’s ad,” his campaign said in a statement to the AP this week.
Pritzker is campaigning to switch the way the state collects income taxes, from a flat tax rate – in which everyone is charged the same percentage from their paycheck – to a graduated income tax, a system that taxes wealthy individuals at a higher rate. To do that, state voters would need to approve an Illinois constitutional amendment change.
Pritzker has not released a proposal showing how much workers would pay under this change, saying he wants to work with Illinois lawmakers to draft a plan after he’s elected. That makes it impossible to calculate the rate workers might pay under his lead but Prtizker’s plan for a graduated income tax rate will change some people’s paychecks, said Paula Worthington, a state and local finance expert at the University of Chicago.
“What the graduated tax structure allows you to do is shift the burden, so some people are going to pay more, and some people are going to [pay] less,” Worthington said.