North Cook News

State Rep. Lou Lang (D-Skokie) wants to raise individual state income taxes to as high as 9.75 percent, according to a bill filed in the Illinois House last week.

Illinois residents currently pay a flat rate of 3.75 percent. Lang’s House Bill 689 would have them pay four rates, depending upon their income bracket -- 3.5 percent, 3.75 percent, 8.75 percent and 9.75 percent.

Lang represents Illinois’ 16th House District, which includes parts of Skokie, Lincolnwood, Morton Grove and Chicago’s West Ridge neighborhood.

"We don't have to stay stuck in the past," Lang said in a press release. "There is another path forward that puts tax dollars back in the hands of hardworking families and eases the pain caused by recent budget cuts."

Lang believes the bill would raise an additional $1.9 billion for state government to spend.

Critics say it won’t, as more Illinois residents and small business owners targeted by the tax hikes will respond by moving elsewhere.

As evidence, they cite the latest U.S. Census, which showed Illinois had the largest net population loss of any state in the U.S. --  losing 22,500 people from July 2014 to July 2015. And a study by New World Wealth released last month reported Chicago is facing an exodus of millionaires that ranked fourth highest of any metropolis in the world last year.

Under the state budget proposed by Lang and House Speaker Michael Madigan (D-Chicago), $1.9 billion will only fund approximately half the $4 billion gap between revenue and spending. 

Lang and Madigan have pushed a state spending plan that requires raising income and property taxes to make ends meet.

“It’s doubly offensive because this proposal comes at a time when lawmakers have not even passed a state budget," John Tillman, of the Illinois Policy Institute, recently told the North Cook News. "How can they tell taxpayers they need more money without offering them an idea of how this money will be spent?"

To become law, such a measure would need more than legislative majorities and the support of Gov. Bruce Rauner -- it would require a majority vote of all Illinoisans to amend the state constitution, which currently requires income tax rates to treat all residents uniformly.

Lang’s bill would give Illinois the fifth highest state income tax rate in the U.S., behind California (13.3 percent), Hawaii (11 percent), Oregon (9.9 percent) and Minnesota (9.85 percent).

Seven states have no individual income tax -- Texas, Florida, Nevada, Alaska, South Dakota, Washington and Wyoming.

Tennessee and New Hampshire don’t tax wages -- only interest and dividend income.