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FORBES: ILLINOIS 3RD IN NATION FOR PEOPLE LEAVING

Illinois Policy Institute | Dylan Sharkey

Forbes magazine highlighted Illinois as one of the top states residents are fleeing for more tax-friendly climates.

Illinois is the third-most common state people are leaving, based on U.S. Postal Service address changes.

Illinois was behind New York and California, and highest in the Midwest, according to Forbes. The three states most people were moving to were Florida, Texas and South Carolina.

It’s no coincidence former Illinoisans are also saying goodbye to some of the highest taxes in the nation. Of the 10 most popular states to move to, four have no state income tax, and all 10 have lower tax burdens than Illinois.

According to a study from Moneygeek, Illinoisans pay the highest tax rates in the nation. Economists arrived at that conclusion by combining property, income and sales tax rates for a hypothetical family making the national median household income in the national median-valued home.

That hypothetical family gave up 16.8% of their income to taxes in Illinois, the highest rate in the nation.

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Gas taxes in Illinois are particularly high because Gov. J.B. Pritzker doubled the per-gallon tax from 19 cents to 38 cents, plus added automatic annual hikes. He delayed the July automatic increase until after the election, so drivers will face two automatic gas tax hikes in 2023: the delayed hike Jan. 1 and the regular hike July 1 when it is expected to hit 45.2 cents.

Forbes cited a 2021 study from United Van Lines that asked people moving why they decided to relocate, and No. 1 was work-related reasons. Illinois had the highest unemployment rate in the nation as of October.

This year, businesses such as Tyson, Citadel, Boeing, Caterpillar and Highland Ventures announced moves out of Illinois. Caterpillar’s former CEO warned Illinois a decade ago that changes needed to be made, yet the state has moved in the wrong direction as far as tax policy.

Lower tax burdens help expand new businesses and jobs. As more residents leave, a shrinking tax base puts additional pressure on those who still call Illinois home.

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