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Pritzker says opponents are misleading voters about graduated income tax

Illinois Gov. J.B. Pritzker said opponents of the proposed graduated income tax plan are intentionally misleading voters who will ultimately decide its fate in November 2020.

“I think opponents of the fair tax certainly are trying to muddy the waters trying to come up with words to make it seem like something it's not,” Pritzker said Thursday morning in a meeting with the Daily Herald editorial board. “The most recent silliness was a ‘blank check jobs tax,' which I'm not sure I understand. It really is a crazy notion that they're putting forward and an untrue notion.”

That phrase was used by former Illinois Manufacturers' Association President Greg Baise, whose Ideas Illinois opposes the graduated tax and says it will push jobs out of state. Pritzker also singled out the Illinois Policy Institute as an opponent of the tax plan that “makes things up.”

Officials at the conservative research organization that tracks and analyzes government spending defended the institute's work since Pritzker's tax plan was introduced in March.

“If he has an issue with any of the information we're putting out, then we'd encourage him to put out his own math so we can respond to it and try to reconcile his findings,” said Adam Schuster, budget and tax research director at the institute. “Our research is based on publicly available data and we are very clear about our methodology and source every one of our claims. But he's not doing the same thing. His lack of transparency is not our problem.”

Pritzker, a billionaire heir to the Hyatt Hotel empire, campaigned on the graduated income tax plan and eventually received support from both chambers of the legislature to put it on the Nov. 3, 2020 ballot. More than 60% of the voters in the election need to approve the measure because it requires a change to the state's constitution. Pritzker said there is no specific campaign he's involved in to push for the measure's passage, but he has made it clear he is politically and personally in favor of what he has dubbed the “Fair Tax.” He has donated his own money to groups pushing for the tax plan's passage and will continue to do so, a spokeswoman said.

The governor said messaging for the next 17 months should involve educating voters and fighting misinformation.

“What the opponents try to do is point at something that isn't true and then amplify that message,” he said. “Under the Fair Tax most taxpayers will do better than you will living in neighboring states like Iowa and Wisconsin.”

Under a rate plan approved by the legislature earlier this month and sent to Pritzker's desk for his signature, tax rates rise in steps, with the first $10,000 in income taxed at 4.75%, the next $90,000 taxed at 4.90%, and the next $150,000 taxed at 4.95% — the state's current flat tax rate. Any income over $250,000 triggers a tax rate of 7.75%. The rate climbs to 7.85% for income over $350,000 for single filers and $500,000 for couples. The biggest tax increase is single filers with income over $750,000 and married couples with incomes over $1 million. Their tax rate is 7.99%, and unlike people in lower income brackets, they would pay that flat rate on all of their income. Pritzker had recommended a 7.95% flat tax rate on all filers whose income exceeds $1 million when his plan was initially introduced.

More than 97% of Illinois taxpayers would pay an income tax rate at or below the current flat tax rate, Pritzker has said. The proposed change is expected to increase income tax revenue for the state by $3.4 billion.

Schuster said the institute's research is unable to replicate those figures and noted the legislature has already changed the affected income brackets from Pritzker's original proposal.

“He's not been an open book and not fully divulged his information,” he said. “It's dishonest to say we're trying to mislead people.”

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