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Gov. Quinn's 2009 Illinois Tax Proposal Summary

Will be updated soon with Gov. Quinn's 2010 tax proposal.

Governor Quinn's Proposed New Revenue Sources:

  • Individual Income Tax - $2.8 billion
  • Corporate Income Tax - $350 million

Individual Income Tax

Governor Quinn is proposing to raise $2.8 billion in new revenue from the Individual Income Tax, and has said he wants to take this opportunity to reform the income tax system. The result of the tax reform will cause some taxpayers at higher income to see their income taxes increase, and some taxpayers at lower income to see their income taxes decrease.
Current Quinn Proposal
3% on Adjusted Gross Income4.5% on Adjusted Gross Income
$2,000 exemption / family member$6,000 exemption / family member

What does this mean?
This means that the income tax will become more "progressive." In effect, with the exception of an individual taxpayer with no dependents, every taxpayer's income they earn up to around the poverty line is tax free. The dependent exemptions favor larger families with many dependents - so it takes into account the additional spending needs required for taking care of a family.

Example:
  • 1 individual: $6,000 tax free (Federal Poverty Level is $10,830)
  • 2 family members: $12,000 tax free (Federal Poverty Level is $14,570)
  • 3 family members: $18,000 tax free (Federal Poverty Level is $18,310)
  • 4 family members: $24,000 tax free (Federal Poverty Level is $22,050)
  • 5 family members: $30,000 tax free (Federal Poverty Level is $25,790)


Quinn Tax Graph



About that "50%" increase

As the graph below will show you, the much-balleyhooed "50%" tax increase fails to ring true. We found this out when looking at what the Effective tax rate is currently, versus what it would be under Gov. Quinn's plan. As you see, the tax increase tops out at about 20% for anyone a family of 4 that could consider themselves middle class.

50% graph



Effective Tax Rates

We have received many questions about how we put together the graph above of the comparison of effective tax rates by income level. This graph shows a direct comparison of the effective tax rates under the current tax system (Red) and the effective tax rates under Gov. Quinn's proposal (Blue). While some groups are claiming that Quinn's proposal is not a "progressive" tax structure because it allows the very wealthy to benefit from the standard exemptions, this chart clearly shows that Quinn's proposal would be far more progressive than the current system. When those groups propose alternatives, we will chart them all together to compare.

Effective Tax Rates



Illinois Tax Revenue Plummets

 

Actual FY2007

Actual FY2008

Estimated FY2009

Projected FY2010

CHANGE SINCE FY2008

State Sources: Revenues (In millions)

 

 

Income Taxes

$11,159

$12,180

$10,867

$9,968

-$2,212

Individual

$9,409

$10,320

$9,417

$8,925

-$1,395

Corporate

$1,750

$1,860

$1,450

$1,043

-$817

Sales Taxes

$7,136

$7,215

$6,674

$6,394

-$821

Public Utility Taxes

$1,130

$1,157

$1,159

$1,150

-$7

Cigarette Taxes

$349

$350

$350

$350

$0

Liquor Gallonage Taxes

$156

$158

$161

$161

$3

Inheritance Tax

$264

$373

$275

$275

-$98

Insurances Tax and Fees

$310

$299

$325

$325

$26

Corporate Franchise Taxes and Fees

$193

$225

$205

$205

-$20

Interest on State Funds and Investments

$204

$212

$80

$80

-$132

Cook County Intergovernmental Transfer

$307

$302

$253

$240

-$62

Other State Sources

$482

$475

$452

$430

-$45

Total State Sources: Revenues

$21,690

$22,946

$20,801

$19,578

-$3,368