In the event you learn a lot about taxes and spending within the state of Illinois, you understand that the state’s in a world of harm. The state authorities has dramatically underfunded its pension system for state authorities employees. Someday within the subsequent decade, the federal government will doubtless have to rein in state pensions, lower the expansion of different spending to give you funds to finance these pensions, or increase taxes.
I’m positive the state’s elected officers will take into account all of these choices sooner or later. However luckily, there may be one main barrier to elevating taxes: the Illinois state Structure.
That is from David R. Henderson, “Constitutions Matter for Tax Charges,” IPI, TaxBytes, January 25, 2023.
One other excerpt:
However that’s not the one benefit. The opposite main benefit is that it makes a legislature assume twice, or a minimum of as soon as, earlier than imposing increased tax charges. The legislators know that what’s sauce for the high-income goose can also be sauce for the low-income gander. Most individuals don’t like having their taxes raised, however many individuals don’t object to having different individuals’s taxes raised. The requirement for a flat tax charge on particular person and company revenue implies that individuals who assist elevating taxes on others know that they can even find yourself being taxed extra.
That’s the place a structure is available in awfully useful. Below the Illinois Structure, all people should pay the identical charge on their particular person revenue and all companies should pay the identical charge on their company revenue.
Learn the entire factor, which is brief.
