x
Breaking News
More () »

Pritzker proposes $1 billion in tax cuts

It's part of the governor's larger, $45.4 billion budget proposal. He's asking for tax cuts at the grocery store, the gas pump and for property taxes.

SPRINGFIELD, Ill — As Illinois enjoys its largest budget surplus in a quarter century, Gov. J.B. Pritzker proposed $1 billion in tax cuts for the upcoming fiscal year. 

During his annual State of the State and budget address on Feb. 2, the governor unveiled a $45 billion budget proposal and touted a $1.7 fiscal surplus.

"I'm pleased to announce Illinois will end this fiscal year with a $1.7 billion surplus, the first of its kind in more than 25 years," Pritzker said. 

Now, he wants to return some of that money to the taxpayers. To do so, he's proposing the Illinois Family Relief Plan, which focuses on several short-term cuts and tax freezes directly impacting Illinois families. 

Three of the key proponents of his proposal include: 

  • Eliminating a 1% sales tax on groceries for one year.
  • Offering a one-time, 5% property tax rebate (with a maximum rebate of $300) to roughly 2 million households.
  • Freezing the state's annual gasoline tax, which is set to increase by 2 cents (from 39.2 cents to 41.4 cents per gallon) this summer.

Another provision in the plan would provide a one-year fee waiver for liquor license and healthcare worker fees. 

RELATED: Gov. Pritzker highlights tax relief, state surplus, balanced budget plan, COVID-19 success in State of the State address

"The family relief plan can't solve all the challenges of global inflation but we can do our part to alleviate some pressure on Illinois working families," Pritzker said. "In Illinois, we believe that the best thing that we can do in difficult times is look out for one another."

While lawmakers on both sides of the aisle have largely agreed with the proposed tax cuts, there were concerns about the lack of long-term tax reforms. 

"It's not permanent income tax cuts like a number of other states are adopting," said Katherine Loughead, a senior policy analyst studying Illinois tax policy at nonprofit Tax Foundation. "But it's welcome nonetheless." 

She said in a state where residents are already paying some of the highest taxes in the country, the proposed plan might not seem like a lot of relief. But she said any help is appreciated, especially when the government has a surplus, as inflation continues to impact Illinois families. 

Loughead noted that the state has made great progress in paying back unpaid bills and reducing the pension debt over the last few years. 

"Once those get paid off, it'll help the state be able to look at structural tax reform and find ways to reduce the tax burden for years to come," Longhead said. "Nothing like that should be expected from these tax relief provisions because they're so temporary, but it's better than the state just pocketing that additional revenue and keeping it for themselves." 

RELATED: THIS WEEK: Iowa wants to flatten your tax

Rep. Mike Halpin, D-Rock Island, agreed and said the state is enjoying a little extra money now after years of hard work. 

"When I first came into office, we had a bill backlog of $17 billion, no budget for three years and weren't sure whether we're making our our pension payments," Halpin said. "It's taken a lot of hard work to be responsible stewards of taxpayer money." 

Although the proposed cuts would only make a one-year difference for many families, Halpin said it's still the right thing to do. 

"I think it's only right to make sure to give taxpayers a little bit of a relief, especially in this time of higher inflation," he said. "The important thing is that we're being responsible and we're trying to ease that pain as much as we can in a responsible way." 

But Rep. Tony McCombie, R-Savanna, said he doesn't think the plan went far enough. 

"The governor is using our money as a tool to elevate his position in the state and on the campaign," she said. "They don't go far enough because it is a one-time bump because of what is going on in our state and in our nation." 

McCombie accused the governor of avoiding structural reform on issues, such as redistricting and property taxes. 

"I support the government putting our tax dollars back into our pockets. 100 percent. Would I support this budget if it was in bill form today? No, I would not," McCombie said. "That's because our spending outpaces our revenue and there's no structural reform." 

RELATED: What did Gov. Pritzker talk about during his State of the State address?

To her, offering a one-year solution won't be enough to attract more citizens. 

"This is going to do nothing to increase our population. And if we had more people living here, as you're fully aware, our tax rate could easily go down," McCombie said. 

It's a stance that Halpin said he doesn't think is fair. 

"I think Republicans are always going to complain about anything Democrats do," Halpin said. "What we've shown is that the Democrats have done the hard work without Republican participation. And now we're able to do this for the people of the state of Illinois and Republicans aren't happy we've been successful." 

The Illinois Family Relief Plan is just a piece of the governor's larger, $45.4 billion budge plan. Lawmakers have until the end of May to approve a budget, but some expect that process to wrap up even quicker, by the beginning of April. 

► Download the WQAD News 8 App
► Subscribe to our daily newsletter
► 
Subscribe to our YouTube channel

Before You Leave, Check This Out