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 Illinois now levies the nation’s highest state and
local tax rates on residents, costing each household $9,488 – or more than 15%
of their annual income – in 2022, a new WalletHub report found.
That tax load is nearly 39% more annually than the nation’s average.
The study also found Illinois state and local governments levy the nation’s
second-highest gas taxes and second-highest effective property taxes on
residents.
Despite being asked to pay more than anyone else, the state’s
worst-in-the-nation pension debt eats dollars that should be spent on
improvements to public services – the things residents expect their taxes to be
used for. Illinoisans are left watching their tax bills climb while their tax
dollars are diverted to cover $219 billion in pension promises made by
politicians.
Illinois’ No. 2 in the nation property taxes illustrate the issue.
When cities and towns face dangerously high pension costs, they are forced to
raise property taxes to cover shortfalls on debt payments. As a result,
residents pay more in taxes towards past government services but don’t see
benefits from current government services. They are more likely to see cuts to
services as the old pension debts consume the new taxes. This often forces
low-income families out of home ownership, or out of the state altogether.
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In the state capital of Springfield, 112%
of property taxes go towards public pensions. Each household would have to pay
$38,813 to eliminate all state and local pension debt. This average pension debt
is even higher in nine other large municipalities, highlighting the
pervasiveness of the state’s pension crisis.
When these pensions eat up more property tax
dollars, less funding is left for essential services such as schools – unless
taxes are increased. State teachers’ pension payments have grown 225% since
2000, now consuming 39 cents of every K-12 education dollar spent by the state
in 2022.
As bad as the tax burden is, Amendment 1 on the
ballot Nov. 8 would guarantee Illinoisans’ total tax burdens continue to grow as
pensions crowd out a greater share of state and local spending. The public
union-backed change to the Illinois Constitution would protect union power and
prevent it from ever being diminished without another statewide vote.
If approved, the amendment would give public unions the power to bargain over a
nearly limitless range of subjects and with protections that overpower state
law. Taxpayers would ultimately be asked to foot the bill on ever-greater union
demands being granted by the politicians whose campaigns those unions fund.
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