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by lotsofpulp 2017 days ago
IL tax rates will have to go to pay for all of the debt for their defined benefit pensions and retiree healthcare.

CA also has that problem, but not to the degree IL has. IL has fewer high income earners to spread the pain around, and higher debt amounts overall.

It’s part of the reason why land is so much cheaper in IL.
1 comments
JMTQp8lwXL 2017 days ago
Illinois voters defeated an initiative to implement graduated income tax in the November 2020 election:

https://ballotpedia.org/Illinois_Allow_for_Graduated_Income_...

Agreed the state has financial issues, but it remains unclear if the upper middle class will bear the responsibility.

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lotsofpulp 2017 days ago
Anyone that has money and lack of political power. Middle class is a vague term, but currently, a flat % income tax takes evenly from rich and poor, so it benefits the rich.

What will happen now is that IL will increase then 5% income tax to 6% or whatever they have to go meet their needs, and so it will continue to benefit the rich.

Until it gets to a point where the lower income people realize they can make the rich pay more, and vote for marginal income tax rates. That’s when the screws will start getting turned on higher income people.

Once that happens, I would assume anyone with disposable income will have their incomes taxes go up. It only failed 47 to 53 this year, so I imagine it will be soon, but I predict the marginal income tax rates will ratchet up even at a “middle” class household income of $80k+.

And then as more rich people leave, the more the marginal income tax brackets have to be expanded and/or percentages increased.

In any case, there’s no relief until sufficient benefit recipients die, and that stupid COLA is no longer in effect. That is one of the most egregious examples of corruption I have seen. Anyone with high school math can see a 3% annual COLA increase would destroy you unless you had the power to print money.

I’m really curious what this map looks like for last decade instead of just 2017:

https://assets.bwbx.io/images/users/iqjWHBFdfxIU/iPUtINXvmFd...

https://www.bloomberg.com/news/articles/2020-12-05/even-befo...

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JMTQp8lwXL 2017 days ago
Only the extremely wealthy would leave. An average person does not move their state of residence just to save $1,000 on state taxes. That could be disruptive: leaving family and friends, your job, etc. All to save a grand.
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lotsofpulp 2017 days ago
It’s more like $10k to $20k (and ever increasing) per year for dual income professional households compared to a no income tax state like Washington. Over a career of 20 to 30 years, that adds up to a substantial amount of savings.

Basically, the families earning $100k+ would be saving 5%+ of state income tax and at least $5k+ in extra property taxes compared to a non debt burdened state and tolls and all the various other taxes that need to be collected to pay for the compounded debt of pensions and whatnot.

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Acrobatic_Road 2017 days ago
Because they are tired of tax increases. It's time to cut pensions.
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