THE IMPACT OF ENACTING A PROGRESSIVE INCOME TAX IN ILLINOIS

Effect
Nome ofScenorio

Figure 17: Impact of Scenario 8 on Tax Cuts, Tax Revenue, Property.r Tax Relief. and the Economy

Scenario 3
"Governor?s Proposal?

 

Example Marginal Tax Brackets
Marginal Tax Rate: 4.75%
Marginal Tax Rate: 4.90%
Marginal Tax Rate: 4.95%
Marginal Tax Rate: 7.75%
Marginal Tax Rate: 7.35%
Marginal Tax Rate: 7.95%

 

$1-510,000
3100010100000
51000015250000
52500015500000

$1,000,001 or More

 

Tax Cut Vs. Tax Hike

 

 

 

 

 

 

Tax Filers with a Tax Cut 85.3%
Tax Filers with No Tax Change 12.0%
Tax Filers with a Tax Hike 2.8%
Net Income Threshold for Lower Taxes $255,000
Household Income for Lower Toxes* $262,000
Total Revenue Change

New State Tax RevenueM $3.12 billion
Can Cut Property Taxes bv 10% Yes
to Invest in Education Yes
to Invest in Infrastructure Yes
to Double EITC No
Change in State and Local 

Net Income: ?$325
Net Income: 525,001-550,000 $419
Net Income: 5500016100300 -$513
Net Income: $100,001-5200,000 -$727
Net Income: $1,000,001 or More +5124,923
Economic Impacts

Jobs Impact 
GDP Impacthet Value +5158 billion

 

*The threshold for lower taxes is the level of adjusted gross income below which a familv ofthree would receive
a tax cut under the progressive tax scenario. The value in parentheses is for single individuals with no children.
?Income taxes paid by owners of pass-through business entities would not be set at 5 percent. This scenario
includes revenue from the proposed 7.95 percent new tax rate on the net income of corporations.
*"**Estimates are for Illinois homeowners. For all estimates for all taxpayers regardless of homeownership
status, please see the Technical Appendix.

""Dvnamic economic impacts include the impact on consumer demand. the impact of a 10 percent propertyr
tax cut, and the impact of potential public investments.

Sourcels): Open records request illinois Department of Revenue 2017i, Forfull details. please see the Technical Appendix.

 

 

 

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