The coronavirus could have a devastating impact on the State of Illinois’ tax revenues, according to the first official State report that attempts to quantify the fiscal fallout from the crisis. The new report, from the Illinois General Assembly’s Commission on Government Forecasting and Accountability (…
Throughout the United States there is a bipartisan consensus that too many people are incarcerated. The concerns focus on the impact on inmates’ families and communities, the loss of productive human potential, racial inequities and high financial cost. Despite recent reductions, Illinois still holds nearly 40,000 adults in its prison system, with significant fiscal impact. Illinois spends an…
As Illinois voters head to the polls for next week’s Presidential primary, this blog post looks at another major choice that will be on the general election ballot in November: whether to replace the State’s flat-rate income tax with a graduated rate structure. The post reviews the proposed new tax rates and examines who will pay more under the new plan and how much revenue it is expected to…
As described in a previous blog post, Governor J.B. Pritzker’s proposed General Funds budget for FY2021 totals $42.0 billion, which is a $2.0 billion, or 5.1%, increase above estimated FY2020 spending of $40.0 billion. The budget for all funds totals $84.5 billion. All funds include funds outside of the general operating funds such as other State funds and other federal funds, but not capital…
Illinois Governor JB Pritzker’s second budget proposal avoids many of the pitfalls of his initial budget recommendation. The proposed budget for the fiscal year that begins on July 1, 2020 makes the full pension contribution required by State law and does not depend on one-time revenues that will not be available in future years. Instead, the FY2021 budget relies on revenue that will only…
In December the Civic Federation explored how Illinois, its local governments and other states tax recreational cannabis. In this post we will look at how those cannabis tax revenues will be spent by the State of Illinois and compare those priorities to other states. The Illinois Department of Revenue projects the State will collect $57 million in FY2020 from cannabis taxes and licensing fees…
More than 50 years after Illinois began taxing residents’ income, voters in 2020 will decide whether the structure of the income tax should undergo a major change. The issue is highly controversial, and the decision will have a long-lasting impact on the State’s finances. Since Illinois’ income tax was adopted in 1969, the State has had a flat income tax. Although tax rates have varied over the…
Annually the Civic Federation releases a report on consumer taxes in the City of Chicago. Consumer taxes are tied to the use or consumption of certain goods and services that can be charged directly to consumers through retail transactions or passed onto consumers by businesses or governments. Consumer taxes in Chicago are imposed at various levels of government including by the City of Chicago,…
UPDATE: The Cook County Board passed ordinance 20-0658, imposing a 3% cannabis retailers’ occupation tax on recreational cannabis sales within the county. The new tax will go into effect July 1, 2020 and is in addition to state and local sales taxes and other cannabis taxes, as described below. The county projects it will receive $850,000 in revenue from the tax during the last six months of 2020…
A recent report shows that Illinois’ statutorily required contributions to its five pension funds are expected to total $9.8 billion in the upcoming fiscal year. How much of the State’s budget will be devoted to pension payments? The answer is not as simple as it might appear and has been the subject of some confusion, including here and here. The main reason for the mistake is that most…
