 State Sen. Larry Bomke, R-Springfield, said the primary component of
the governor's plan consisted of a 50 percent increase in state
income taxes. The $3 billion tax hike, if passed, would be the
largest tax increase in Illinois history -- three times larger than
any other major tax increase ever approved.
Under the Quinn plan, individuals would see their personal income
taxes rise from 3 percent to 4.5 percent, while the corporate income
tax rate would increase from 4.8 percent to 7.2 percent. Although
the governor increased the personal exemption on income taxes to
$6,000, most Illinois taxpayers would see a tax increase -- single
taxpayers making more than $16,000 annually and families of four
with annual household incomes exceeding $61,000.
Illinois residents interested in seeing how they would fare under
the Quinn plan can visit http://budget.illinois.gov/taxcalculator.htm
to calculate how their tax bill would be affected.
In addition to income tax increases, the governor proposed
several other tax and fee hikes for the upcoming fiscal year. State
employers would face $287 million in additional costs through the
removal of various tax credits aimed at fostering economic
development. Bomke expressed concern that the move would further
weaken the struggling Illinois economy, which lost 175,000 jobs last
year and ranks 46th nationally in terms of job growth.
Smokers and drivers would also see higher taxes under the Quinn
plan. The tax on cigarettes would increase $1 per pack; motor
vehicle fees would jump from $79 to $99; and driver's license fees
would double from $10 to $20.
Changes to the state pension system are another highlight of the
governor's plan. To help free up money for the budget, Quinn
proposed a $3.2 billion raid of the pension system, the biggest
shorting of pension funds ever. He is also seeking the creation of a
"two-tiered" pension system, with one set of benefits for current
members and less-generous benefits for new members.
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Quinn's plan raises the retirement age for newly hired teachers and
state employees from 62 to 67 and reduces benefit formulas for new
state hires. Meanwhile, current teachers and state employees would
have to contribute more, with an additional 2 percent of their
salary going to the pension system.
Noting that new state spending has increased by $7 billion during
the last six years, Bomke expressed disappointment that more
emphasis wasn't placed on spending cuts in the governor's fiscal
2010 proposal, which actually increases general revenue fund
spending by $628 million compared with fiscal 2009. Programs imposed
by former Gov. Rod Blagojevich, such as subsidized health care
coverage for families making up to $80,000, were largely left
untouched.
A final pillar of the governor's plan was a new $26 billion
capital construction program to update and expand Illinois'
infrastructure, including roads, bridges, highways, schools and mass
transit networks. It has been a decade since Illinois last had a
capital program.
[Text from file sent on behalf of
Sen.
Larry Bomke by Illinois
Senate Republican staff]
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