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 Gov. Pat Quinn tried to
cushion the blow Tuesday, promoting his plans for tax relief the day
before he unveils what undoubtedly will be major tax increases on
income, smoking and driving.
The Democrat announced
that he wants to offer parents a sales-tax holiday for
back-to-school purchases this summer. He also stressed that many
Illinois families would not pay anything more under the income tax
plan he's preparing.
"We're going to give tax
relief right now to vulnerable people worried about their jobs,
worried about their families," Quinn told reporters in Chicago.
"We're cutting their taxes."
A "blueprint" of the
budget provided to some Illinois lawmakers shows Quinn will propose
increasing the personal income tax by as much as 1.5 percent, to 4.5
percent, to bring in $4.8 billion.
Quinn is looking at a $20
increase for license plates, which will cost $79 starting this
summer, and doubling the $10 price of a driver's license.
And Quinn may seek a $1
increase in the tax on cigarettes, which now stands at 98 cents a
pack. The increase would be spread over two years.
He also promised to "cut
the budget big-time" as he seeks to put state government back on
solid financial ground. "I want to say to the people of Illinois,
we're going to pay our bills."
The governor, facing what
he says is an $11.5 billion deficit just six weeks after taking
office, has a tough sales job ahead of him. Most lawmakers are open
to tax increases but they need proof to take home to voters.
"He's gotta tell us:
Where's this money going to go to? Where's his cuts going to come
at? What's his reforms going to be?" said Sen. Terry Link,
D-Waukegan.
The budget blueprint,
first reported by the Chicago Sun-Times, shows the state could take
in $276 million by raising cigarette taxes.
Charging more for license
plates and driver's licenses could generate $200 million a year,
which would finance a statewide construction program to repair
roads, bridges and other infrastructure. Diverting about $150
million from the state road fund would also support the
construction.
Some legislative
Democrats favor a gasoline-tax increase, something Quinn opposes.
Republicans, who have proposed gambling
expansion to fill some of the budget hole and start a building plan,
are generally opposed to an income-tax increase or a hike in the
corporate tax.
Revenue from higher taxes
will fall short of projections because people will change habits to
shield income, said Rep. Mark Beaubien, R-Barrington Hills. Taxing
businesses in this economy, he said, would be devastating.
"People won't expand
their businesses, they'll leave the state," Beaubien said. "They
certainly won't come into the state. It's very counterproductive if
you want to create jobs and help the economy."
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Quinn's budget blueprint
calls for raising the 4.8 percent corporate rate to 5.9 percent,
generating $175 million.
Quinn said a family of
four making $24,000 a year would pay no income taxes at all under
his plan because he wants to increase the personal exemption.
Families of four making less than about $61,000 would see their tax
bill fall, he said.
A sales tax holiday would
also ease the burden. Quinn wants to lift the 5 percent sales tax
for 10 days in August on certain school-related items.
Normally, local
governments would get a share of any income tax increase. Quinn's
plan would keep all the additional money for the state, meaning
cities would miss out on $287 million -- something Link said would go
nowhere because of protests from city halls across the state.
Quinn also may take $200
million out of a variety of government funds that are supported by
special fees and dedicated to particular programs. Such diversions
were common under his predecessor, Rod Blagojevich, who was removed
from office in January.
The budget blueprint
includes another idea favored by Blagojevich: Ending several tax
breaks for businesses. The move would save the state about $100
million, but lawmakers have rejected the idea in the past.
The variety of increases
could pose problems, too, in convincing taxpayers to go along.
"If we have to make some
difficult decisions, it would be easier for legislators if we had to
deal with one, or at least a limited number of revenue enhancers,
instead of a whole slew," said Sen. John Sullivan, R-Rushville.
[Associated Press;
By JOHN O'CONNOR]
Associated Press writers
Christopher Wills in Springfield and Caryn Rousseau in Chicago
contributed to this report.
Copyright 2009 The Associated Press. All rights reserved. This
material may not be published, broadcast, rewritten or
redistributed.
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