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Reeder: Tax increase still questionable

Published: Tuesday, March 4, 2014 9:58 p.m. CDT • Updated: Tuesday, March 4, 2014 10:02 p.m. CDT

SPRINGFIELD – Back in 2011, the state of Illinois began snatching away an extra week’s worth of our pay.

At the time, we were assured of two things: The tax hike was necessary, and it would be temporary. But like so much that politicians tell us, both statements are questionable.

First of all, we were told that the increase was necessary to help put the state’s fiscal house in order and to pay down the backlog of unpaid bills. But even after jacking up our taxes the state’s fiscal condition is pathetic.

Springfield is paying its bills many months late, the state pensions are the worst funded of any state and Illinois’ credit rating is in the crapper.

Instead of using the extra tax dollars to pay down bills, Springfield politicians used it increase spending. That shouldn’t come as a surprise. Most politicians are far more comfortable spending than saving. After all, it’s what they do best. And, for the record, there are plenty of myths surrounding this tax hike.

The most persistent – and most annoying – is that the politicians only raised our income taxes by 2 percent. Even as abysmal as I was in high school math, I can tell you that raising the income tax rate from 3 percent to 5 percent is a tax hike of 67 percent – not 2 percent.

It being Springfield, any of these answers may be correct. Some would have you believe this tax hike is picayune – hardly noticeable for the average household. Nonsense. The tax hike alone is the equivalent of one week’s pay for every worker in Illinois.

And what have workers gotten in return? Not much. The state is still broke. Spending is on the upswing. Bills are still going unpaid. And guess what? Now they are talking about taking the “temporary” out of the income tax increase.

What makes our leaders think they will start using it wisely if it becomes permanent?

State revenues are at their highest level in Illinois’ 198-year history. Springfield has a problem with spending – not revenue.

It’s time for our lawmakers to say “goodbye” to the tax hike and embrace difficult spending decisions.

• Scott Reeder is a veteran statehouse reporter and the journalist in residence at the Illinois Policy Institute. He can be reached at sreeder@illinoispolicy.org.

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