The Governor has confirmed that he wants to cut the income tax for everyone by making the first $6,000 of income tax free. Right now the first $2200 of income is tax free. So the benefit is basically $120 from the 3% tax rate. And with a 4.5% tax rate, the benefit of not taxing an extra $4000 is $180.
In other words, the Governor proposed an income tax cut of $180 for everyone.
He also wants to raise the income tax rate from 3% to 4.5%. Illinois has the lowest income tax rate of any state in the Union that has an income tax. We're lower than Indiana (at 3.4%). We are lower than every other state that has an income tax. So that is an income tax increase.
To be clear, he proposed an income tax cut of $180 and then a higher rate of 4.5% instead of 3%.
That is not a 50% increase.
Most people get a tax cut. (If you make $6,000 a year, you will pay less than you do today. That's a tax cut). A few people get a wash (the $180 tax cut from the personal exemption about equals the higher rate). And some people will pay more because the higher income tax rate will be bigger than the $180 tax cut from the personal exemption.
So media headline writers! Don't screw this up! Quinn did NOT propose a 50% income tax increase! He proposed a tax cut and a tax increase. Most people will pay less (that's my initial cut of the math -- I may be wrong). Some people will pay more. But most people will NOT face a 50% income tax increase.
And, since state income taxes are deductible on federal income tax returns, this is a really smart move, because it means that the actual dollars paid in taxes by our wealthiest Illinoisians (a group I hope to join), will not be 50% higher than they were before Quinn's proposal. For every dollar a millionaire pays in state income taxes, she cuts 35 cents off her federal tax bill. So the actual bottom-line increase for even the wealthiest people in Illinois is 65 cents on the dollar for every dollar increase in the state income tax (making the 50% increase even more incorrect).