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Sangamon Sun

Tuesday, November 5, 2024

Linking higher income taxes with lower property taxes described as wishful thinking

Budget crisis

If Illinoisans can live with higher income taxes for five years, they might in return get bailed out from the ever-growing onus of high property taxes, Sen. Bill Brady (R-Bloomington) said recently, according to Politico.

“The hope here would be if Republicans would participate in a revenue increase, that the revenue increase would be associated in time with a property tax freeze,” Brady said, according to Politico.

Brady declined to characterize the idea as part of the "grand bargain," but suggested that the property tax freeze would benefit from having a larger context if it were tied to higher income taxes and an increase in taxes on some services.

Carol Portman of the Taxpayers Federation of Illinois argued, however, that the real problem goes much deeper than property taxes.

“The idea comes from the frustration people have when they see that in Illinois, property taxes are high,”  Portman told the Sangamon Sun.

She said part of the issue is that local governments in Illinois are expected to pitch in more to education funding than those in some other states. Those responsibilities make property taxes higher.

“It's a circular sort of a thing,” Portman said.

In fact, Portman cautioned that even if a property tax freeze were instituted, not all homeowners would necessarily see immediate tax reductions or even a stabilized tax bill.

“Your tax bill might still go up,” Portman said. “If they pass it, some property taxes will go up and some will go down, depending on relative property value changes within the taxing district.”

Portman pointed to skyrocketing pension costs -- which are not discretionary -- and a backlog of bills as putting even greater pressure on the state.

“The state is slow in paying its bills,” she said.

Portman also warned that even budget items that can be cut are often quite popular.

Residents will push back against the idea of cutting something like an after-school program or Meals on Wheels, but at the same time local governments are expected to find cost savings in areas in which they have no practical control, she said.

“It’s a complicated thing.” Portman said.

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