State House hopeful Babcock talks about taxes
"Stop the madness" is an ongoing theme in Mike Babcock's campaign for state House in District 111.
The Republican challenger from Metro East believes in a simpler, fairer tax system for Illinois.
Illinois has one of the highest property tax rates in the nation, second only to New Jersey, and an overall tax rate of 10.19 percent. While the state is ranked 10th in income taxes, Babcock reminds voters that other states also give significant tax deductions.
“One thing people forget is the fact that in most states you can write off many items on your taxes,” Babcock said. “In Illinois, there are very few tax deductions, if any at all. So when you add this to the highest property tax, it becomes very questionable at best as to whether or not we do have the highest tax when you add it all together.”
Illinois' budget woes have exacerbated the tax issues. From 2011 to 2015, a temporary income tax hike was imposed on individual taxpayers and corporations. With the expiration of the Taxpayer Accountability and Budget Stabilization Act in December 2015, state revenues dropped. While the tax hike was promoted as a solution to the $8.5 billion backlog of unpaid bills, at the end of 2015 the unpaid bills stood at approximately $7 billion. The state collected $31.6 billion in taxes during the four year period, but failed to pay off its bills.
Discussion continues on reinstating the tax hike and making it permanent. The individual tax rate would rise from 3 to 5 percent and the corporate rate would rise from 4.8 to 7 percent. Senate President John Cullerton (D-Chicago) and House Speaker Mike Madigan (D-Chicago) both supported making the tax increase permanent.
Babcock opposes all tax increases. As part of his opposition to Illinois' heavy taxes, he signed the Taxpayer Protection Pledge. Politicians who sign the nonpartisan Taxpayers United of American’s pledge promise to decrease their constituents' overall tax burden.
Despite the lower revenues, the state continued to operate without a full budget. The budget impasse continued through 2015 and into 2016 as Democratic lawmakers battled with Gov. Bruce Rauner and their Republican colleagues over reforms that would make structural changes in the state's spending, pensions and worker's compensation regulations.
The House attempted to pass an unbalanced budget in May, however, the Senate voted against it, citing the $7.2 billion in the red. Babcock opposed the proposed budget and pointed out that his Democratic opponent Dan Beiser (D-Metro East) voted in favor of the bill.
"Dan Beiser voted for the largest unbalanced budget in Illinois history. The 500-page bill, given to House members at 4:28 p.m., was voted on just three hours later. Madigan’s budget, unbalanced to the tune of $7.2 billion, forces a $1,000 tax hike on the average Illinois family – a 47 percent tax hike – and the highest rate in Illinois history."
The legislature went on break after the May 31 budget deadline passed, leaving the state without a budget. It reconvened in late June and passed a temporary stopgap budget that funded education and essential services. While that budget kept the government operating, it did not address the backlog of unpaid bills.
State Comptroller Leslie Geissler Munger warned that if the state does not address the bill backlog, individual taxpayers' income taxes could go as high at 8 percent in order to pay the state's current and past due bills. The unpaid backlog may rise to $14 billion by the end of the fiscal year if a full budget is not passed when the General Assembly meets in November.
"We need a balanced budget," Babcock said. "We need to rein in our spending. We need to pay our bills on time. When you’re in a hole, the best thing you can do is stop digging."