Tuesday, September 29, 2020

What voters should know about state’s graduated tax proposal




What voters should know about state’s graduated tax proposal

By Doug Finke
The State Journal-Register

Posted Sep 27, 2020 at 12:01 AMUpdated Sep 28, 2020 at 8:27 AM

Perhaps the biggest race in the upcoming general election doesn’t have any candidates running.

It is the race on whether or not to approve an amendment to the Illinois Constitution to bring a graduated state income tax to Illinois for the first time in its history.

It could be the defining moment in Gov. JB Pritzker’s tenure, something he pledged to bring to the state when he ran for the office and something he’s made a central component during the first half of his term.

Both proponents and opponents argue it will have a profound impact on Illinois’ economic future, with one side saying it is for the good and the other saying the opposite.

Here’s a rundown of what you need to know.

What is a graduated income tax?

It is a tax that applies different tax rates to different levels of income. The federal income tax works this way. People with higher incomes pay higher tax rates.

In fact, most states that have an income tax use a graduated tax system. There are 41 states that have a state income tax. Of those, 32 have a graduated income tax. Only nine, including Illinois, have a flat tax.

What is a flat tax?


Under the Illinois system, all individuals pay the same tax rate regardless if they make $20,000 a year or $20 million a year. Proponents of the current system argue that this promotes economic development and helps discourage lawmakers from raising the income tax. If the tax is increased, the increase must apply to everyone, not just a small group earning a larger income, which makes an increase less likely, they argue.

Proponents of the graduated tax contend it is fundamentally unfair for everyone to pay the same rate regardless of income level. They contend it has promoted income disparity in the state.

Can’t the General Assembly simply make the change?

No. The flat tax is written into the state constitution. It can only be changed by the voters.

There are two ways the amendment can be approved. If 60% of the votes cast on the amendment proposal are “yes,” it will be approved. It will also pass if a majority of all of those voting in the election vote in favor of it.

What will the tax rates be if the amendment is approved?

The General Assembly has already approved the rates that would go into effect if the amendment is approved. Remember, the rate for individuals is now 4.95%.

The new rates would be: 4.75% for income up to $10,000; 4.90% for income between $10,001 and $100,000; and 4.95% for income between $100,001 and $250,000. Those numbers apply for both single and joint filers.

For single filers, the rate is 7.75% for income of $250,001 to $350,000, and the rate is 7.85% for income of $350,001 and $750,000. For joint filers, the rate is 7.75% for income of $250,001 to $500,000, and the rate is 7.85% for income of $500,001 to $1 million.

The top rate is 7.99% for single filers making more than $750,000 and joint filers making more than $1 million.

The corporate rate would increase from the current 7% to 7.99% regardless of income.

One thing to remember is that the rates apply to those different levels of income, except for the highest earners. Thus, even for someone who makes $100,000 a year, the first $10,000 of income is taxed at 4.75%.

For individuals who make more than $750,000 a year and joint filers who make more than $1 million a year, the entire amount of their income is taxed at 7.99%.

Will I pay more under this amendment?



Pritzker and other proponents of the graduated tax have said that 97% of Illinois income tax payers will pay the same as or less than they now pay. Only the top 3% of earners will pay more, they said. That means people with incomes above $250,000 a year.

Pritzker’s office has set up an online calculator that people can use to determine how the amendment will affect their taxes. It can be found at https://www2.illinois.gov/sites/gov/fairtax/Pages/default.aspx

That’s a big selling point, right?

For the proponents, it certainly is. But it is also a major reason why the opponents think it is a bad idea.

The opponents contend wealthier residents will be tempted to abandon the state and take their tax dollars with them. They also argue the higher rates on upper incomes will damage economic growth in the state. Finally, they argue that lawmakers will find it easier to raise taxes in the future because they can do it on a smaller number of earners rather than everyone. Inevitably, the opponents argue, those increases will also hit lower income levels.

Supporters of the amendment argue that it is never easy for elected officials to raise taxes making those fears are unfounded. Since no one can predict the future, it comes down to which voices you trust the most.

Will retirement income be taxed by the amendment?


No. Most retirement income isn’t taxed in Illinois now and that won’t change if the amendment is adopted. Amendment opponents are airing an ad showing a woman identified as a retiree saying the amendment will provide “new powers” to the state to tax retirement income. It won’t. The state could tax retirement income now, but it doesn’t because legislators know that is a hugely controversial and unpopular issue.

AARP Illinois supports the amendment.

“No matter who has said it or how they have said it, the simple truth is that switching to a graduated income tax does not allow the state to tax retirement income,” the organization says on its web site. “And it does not make it easier to tax retirement income in the future. AARP Illinois adamantly opposes taxation of retirement income and we would not support the graduated income tax if it did.”

Will the graduated tax raise more money?

Yes. For a full fiscal year the graduated income tax is projected to bring in $3.4 billion. If the amendment is approved, the new rates would go into effect January 1 which is midway through the state’s fiscal year. Thus, the full amount won’t be realized immediately.

Pritzker has warned that without the extra income from the graduated tax, the state will likely have to cut spending or raise income taxes across the board. Many Republicans and other opponents of the amendment contend the state spends too much money as it is and budget cuts would not be a bad thing.

Contact Doug Finke at doug.finke@sj-r.com, (217) 788-1527 or twitter.com/dougfinkesjr.

Above is from:  https://www.sj-r.com/news/20200927/what-voters-should-know-about-statersquos-graduated-tax-proposal?rssfeed=true

Mitigating begins Saturday


After two-point positivity rate jump in two weeks, resurgence mitigation imposed on Region 1

Tuesday, Sep 29, 2020

* Press release…

Governor Pritzker and the Illinois Department of Public Health (IDPH) are announcing COVID-19 resurgence mitigations will be implemented in Region 1, the northwestern most counties in Illinois, beginning Saturday, October 3, 2020. The region is seeing a 7-day rolling average test positivity rate of 8% or above for three consecutive days, which exceeds the threshold set for establishing mitigation measures in the region under the state’s Restore Illinois Resurgence Plan. This announcement follows last week’s warnings to local leaders that additional mitigation measures would be implemented if the region continued to see an increase in cases. Region 1 includes Boone, Carroll, DeKalb, Jo Daviess, Lee, Ogle, Stephenson, Whiteside and Winnebago counties.

“The concerning uptick in Region 1’s positivity – jumping more than two percentage points in two weeks even as the majority of Illinois continues to see downward trends – demands increased efforts to stop the spread in our northwestern counties,” said Governor JB Pritzker. “As other regions have demonstrated, stricter mitigations will lead to safer communities when people mask up, keep their distance, wash their hands and respect public health. It is my hope that the residents of Region 1 can turn this situation around quickly, and Dr. Ezike and I continue to coordinate with local officials to make that happen.”

“COVID-19 spread can increase very quickly, as we’ve seen in some regions in the state, now including Region 1,” said IDPH Director Dr. Ngozi Ezike. “As the pandemic continues, so must our fight against it: Please, don’t hold or attend large events or mass gatherings, wear your face covering, and keep six feet of distance between you and others.”

In the past week, Region 1 also had an early indication of increasing hospital admissions for COVID-like-illness. Although this increase has not yet reached the threshold level, it indicates more severe illness is increasing and IDPH will continue to monitor the region’s hospital capacity.

Mitigation measures taking effect October 3, 2020 in Region 1 include the following:

Bars

    • No indoor service
    • All outside bar service closes at 11:00 p.m.
    • All bar patrons should be seated at tables outside
    • No ordering, seating, or congregating at bar (bar stools should be removed)
    • Tables should be 6 feet apart
    • No standing or congregating indoors or outdoors while waiting for a table or exiting
    • No dancing or standing indoors
    • Reservations required for each party
    • No seating of multiple parties at one table

Restaurants

    • No indoor dining or bar service
    • All outdoor dining closes at 11:00 p.m.
    • Outside dining tables should be 6 feet apart
    • No standing or congregating indoors or outdoors while waiting for a table or exiting
    • Reservations required for each party
    • No seating of multiple parties at one table

Meetings, Social Events, Gatherings

    • Limit to lesser of 25 guests or 25 percent of overall room capacity
    • No party buses
    • Gaming and Casinos close at 11:00 p.m., are limited to 25 percent capacity, and follow mitigations for bars and restaurants, if applicable

These mitigations do not currently apply to schools.

IDPH will track the positivity rate in Region 1 to determine if mitigations can be relaxed, if additional mitigations are required, or if current mitigations should remain in place. If the positivity rate averages less than or equal to 6.5% for three consecutive days, then Regions 1 will return to Phase 4 mitigations under the Restore Illinois Plan. If the positivity rate averages between 6.5% and 8%, the new mitigations will remain in place and unchanged. If the positivity rate averages greater than or equal to 8% after 14 days, more stringent mitigations can be applied to further reduce spread of the virus.

Region 4, the Metro East, remains under additional mitigation measures as well. Although the 7-day rolling average test positivity rate is less than 8%, it remains above 6.5% and has increased in recent days.

IDPH continues to monitor each region in the state for several key indicators to identify early, but significant increases of COVID-19 transmission in Illinois, potentially signifying resurgence. Indictors include an increase in the region’s positivity rate with a simultaneous increase in either hospital admissions for COVID-like-illness or a decrease in hospital capacity, or three consecutive days of greater than or equal to 8% test positivity rate (7-day rolling average). These indicators can be used to determine whether additional community mitigation interventions are needed for a region to prevent the further spread of COVID-19.

A full list of mitigation measures pertaining to some businesses and industries may be found on the Illinois Department of Commerce and Economic Opportunity (DCEO) website at www.dceocovid19resources.com/restore-illinois.

Above is from:  https://capitolfax.com/2020/09/29/after-two-point-positivity-rate-jump-in-two-weeks-resurgence-mitigation-imposed-on-region-1/

September 29: 1362 New COVID 19 Cases in Illinois

24 additional fatalities in Illinois.  10 new COVID 19 cases in Boone County.


Region 1 (DeKalb, Rockford area, Sauk Valley) one day from COVID-19 mitigations; state positivity rate drops to 3.6%

One more day at or above 8% will trigger additional mitigations for Region 1

By JOHN SAHLYFollow12:14 PM

A sign is seen at Independence Park in Evanston, Ill., Friday, May 29, 2020. Every region of Illinois met the criteria to move into Phase 3 of reopening Friday, May 29. Most of the state will do so, but Chicago will have to wait until June 3 to partially reopen. Starting Friday, more businesses will be allowed to reopen and people can start gathering in small groups while social distancing.Personal care services such as salons, spas and tattoo parlors can also reopen for reservations only. (AP Photo/Nam Y. Huh)

Nam Y. Huh

Caption

As a public service, Shaw Media will provide open access to information related to the COVID-19 (Coronavirus) emergency. Sign up for the newsletter here

The Illinois Department of Public Health reported 1,362 new confirmed cases of COVID-19 and 23 additional deaths Tuesday.

The seven-day rolling average of Illinois’ positivity rate decreased slightly to 3.6%. The state received the results of 45,624 COVID-19 tests in the 24 hours leading up to Tuesday afternoon.

Illinois now has seen 291,001 total cases of the virus and 8,637 people have died. The state has conducted a total of 5,566,276 tests since the start of the pandemic.

As of late Monday, Illinois had 1,535 COVID-19 patients in the hospital. Of those, 363 were in intensive care units, and 151 were on ventilators.

Regional update: Additional restrictions can be placed on any of the state's 11 health regions if the region sustains an increase in its average positivity rate for seven days out of a 10-day period.

A region may also become more restrictive if there is a seven-day increase in hospital admissions for COVID-19-related illness or a reduction in hospital medical/surgical beds or ICU capacity below 20%. If a region reports three consecutive days with greater than an 8% average positivity rate, additional infection mitigation will be considered through a tiered system of restriction guidelines offered by the IDPH.

The North Suburban region (McHenry and Lake counties) has seen two days of positivity increases and one day of hospital admission increases. The region's positivity rate decreased slightly to 4.8%. Currently, 40% of medical/surgical beds are available and 49% of ICU beds.

The West Suburban region (DuPage and Kane counties) has seen two days of positivity increases and two days of hospital admission increases. The region's positivity rate remained flat at 5.4%. Currently, 32% of medical/surgical beds are available and 44% of ICU beds.

The South Suburban region (Will and Kankakee counties) has seen one day of positivity increases and four days of hospital admission increases. The region's positivity rate remained flat at 5.2%. Currently, 29% of the region's medical/surgical beds are available and 31% of ICU beds.

The North region (Boone, Carroll, DeKalb, Jo Daviess, Lee, Ogle, Stephenson, Whiteside and Winnebago counties) has seen eight days of positivity increases – meeting one of the criteria for stricter mitigation measures – and four days of hospital admission increases. The region's positivity rate increased to 8.3%, the highest rate of any of the state's 11 regions. Currently, 41% of medical/surgical beds are available and 50% of ICU beds.

This marked the second consecutive day the region's positivity has hit at or above the state's fail-safe of 8.0%. If it is at 8.0% or higher on Wednesday, the region will be subject to additional COVID-19 mitigation measures from the IDPH.

The North-Central region (Bureau, Fulton, Grundy, Henderson, Henry, Kendall, Knox, La Salle, Livingston, Marshall, McDonough, McLean, Mercer, Peoria, Putnam, Rock Island, Stark, Tazewell, Warren and Woodford counties) has seen two days of positivity increases and one day of hospital admission increases. The region's positivity rate increased slightly to 5.4%. Currently, 44% of medical/surgical beds are available and 45% of ICU beds.

Chicago has seen three days of positivity increases and four days of hospital admission increases. The region's positivity rate decreased to 4.4%. Currently, 26% of medical/surgical beds are available and 32% of ICU beds.

Suburban Cook County has seen three days of positivity increases and two days of hospital admission increases. The region's positivity rate remained flat at 5.1%. Currently, 27% of medical/surgical beds are available and 36% of ICU beds.

To see how other regions across the state are doing, see the full IDPH dashboard here.


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Is Mitigation on the Way?




Boone County officials prepare to re-enter COVID-19 mitigation this week

NEWS

by: Michele Rave

Posted: Sep 28, 2020 / 05:09 PM CDT / Updated: Sep 28, 2020 / 05:09 PM CDT

BOONE COUNTY, Ill. (WTVO) — Boone County has one of the highest COVID-19 positivity rates in our area.

On Monday, the Board of Health discussed the next steps for them as they try to help local businesses.

Boone County health officials are preparing to go into mitigation this week or next. Forward Boone County as well as the Belvidere Chamber are doing what they can do aid local bars and restaurants if they are not allowed to have indoor dining.

There is no time limit for this phase. In fact, to get out of the mitigation process, Boone County has to hold a 6.5% positivity rate for three days. Reducing that rate is essential to getting back to normal.

“Providing some online resources to help some of our small businesses download some apps where they can have the public order online, do curbside pickup,” explained Amanda Mehl, the Public Health Administrator for the Boone County Health Department.

“So, if we do end up limiting and closing indoor dining and going back to more of the drive thru, walk up and pick up order options while we’re in mitigation we can assist our small businesses with those online options as well.”

Forward Boone County is encouraging businesses to attend their online discussion about what the mitigation steps will look like. The discussion is Tuesday at 7:00 p.m.

Join the meeting online at  https://us02web.zoom.us/j/83499557500 or dial-in at  1.312.626.6799  Meeting ID: 834 9955 7500.

Above is from:  https://www.mystateline.com/news/boone-county-officials-prepare-to-re-enter-covid-19-mitigation-this-week/