 "If we don't do this, who you gonna cut? The disabled? Senior
citizens?" said Sen. Rickey Hendon, D-Chicago. "Who you gonna cut?
Who's going to suffer? How much pain should the people of Illinois
go through?"The proposal would raise the personal income tax rate
from 3 percent to 5 percent and the corporate rate from 4.8 percent
to 5 percent. It also would apply the sales tax to some services,
such as dry cleaning.
It would provide about $700 million in tax relief by increasing a
credit for people who pay property taxes, offering about $700
million in tax relief, supporters said. It would also cushion the
blow of the higher income taxes by increasing the personal exemption
and tripling a tax break for the working poor.
"It raises the cost of living in Illinois and it raises the cost
of doing business in Illinois," said Sen. Bill Brady, R-Bloomington.
"If you vote for this, you're voting for your children and
grandchildren to probably look to another state to find a job."
The measure, which passed 31-27 with one person voting "present,"
heads to the House. Democrats there have been trying and failing to
find enough votes for a tax increase -- they've been discussing a
two-year increase to 4.5 percent -- and the Senate victory could
help their efforts.
The Senate also voted to legalize four new casinos, potentially
bringing the state an additional $1 billion. Meanwhile, the House
approved a plan to refinance state debt, saving about $600 million,
and to divert $356 million from funds supported by special fees.
Supporters said raising taxes during a recession is painful but
necessary when the state faces a budget deficit of at least $11.6
billion.
If taxes go up, state government will still have to make
significant spending cuts. Without it, warned Democratic lawmakers,
vital services to the state's neediest people would be slashed.
House Majority Leader Barbara Flynn Currie, D-Chicago, said most
education and Medicaid spending would be spared but cuts in many
other areas would reach 50 percent. That would require cutting
child-care programs for poor families, elderly community care
services, welfare, bilingual education and more, she said.
Without an agreement on how to fill the budget hole, lawmakers
may simply approve what limited money is available and end their
spring session. That would leave state agencies to limp along with
only a portion of the money they need for the fiscal year starting
July 1.
"At the end of the day it is a short-term fix," said House
Minority Leader Tom Cross, R-Oswego.
Gov. Pat Quinn wouldn't say whether he will veto a budget that
doesn't include enough money to operate for the full year.
"I don't really want to be thinking about vetoes. I'd rather
think about everybody coming together in the next 24 hours and
passing a budget," said Quinn, a Chicago Democrat.
[to top of second column] |
He said former Republican Govs. James Thompson and Jim Edgar had
called GOP lawmakers to drum up support for a tax increase. But
there was no evidence the calls were having any impact, as
Republicans remained united against the idea.
The spring legislative session is scheduled to end Sunday,
although lawmakers could extend it.
If they do, new rules kick in and it will take a three-fifths
vote, rather than a simple majority, to pass a budget. That would
require Republican votes, giving the GOP new leverage to make
demands but also preventing them from leaving the messy problem in
Democratic hands.
Supporters of a tax increase say it would not take the place of
budget cuts.
They estimate that after spending cuts that have already been
approved and the arrival of federal stimulus money, Illinois
government still faces a gap of about $7 billion between revenue and
expenses. The Senate tax plan would generate about $5.2 billion and
a House version approved in committee Saturday would generate about
$4.5 billion, so neither one would close that budget gap.
About $1 billion of the money from the Senate plan would come
from applying the sales tax to some services, which are now exempt.
Examples of newly taxed services would include carpet cleaning,
dating services, taxis and video rentals.
One reason some legislators are reluctant to support a tax
increase is that it wouldn't solve the full budget problem. They
would cast that risky vote and still have to make painful cuts.
Others believe it's bad policy or that their constituents,
particularly in the Chicago area, are already fed up with tax
increases.
The decision also carries political implications: Next year is an
election year, and legislators who vote for a tax increase can
expect attacks from political opponents.
The Senate gambling plan, which was sent to the House on a 30-28
vote, would add casinos in Chicago, Rockford, Park City in Lake
County and Danville in eastern Illinois. Existing riverboat casinos
could add up to 800 gambling positions to the 1,200 each has.
The state's take of the casinos' profits could eventually top $1
billion a year.
Sen. Matt Murphy, R-Palatine, criticized the measure, saying it
would "make Illinois the gambling Mecca of the United States."
[Associated Press]
Copyright 2009 The Associated Press. All rights reserved. This
material may not be published, broadcast, rewritten or
redistributed. |
