Legislation To Tax Illinois Millionaires Stalls

May 22, 2015

As Illinois lawmakers grapple with a budget shortfall, a measure to impose a tax on millionaires' income stalled.

Credit Flickr user 401(K) 2012 / "Money" (CC v. 2.0)

Adding a surcharge to income over a million dollars to raise more money for Illinois schools was a concept Democratic House Speaker Michael Madigan introduced last year, but there wasn't enough support. Now, as Illinois faces a $6 billion budget gap, he brought it back.

"We're simply asking those that have done well in life to help our educational system," Madigan said.

But his effort came up short, by three votes. There are 71 Democrats in the Illinois House, just enough that if all of them had gone along with it, the measure would have passed; instead, three Democrats voted no.

Critics say the measure, which requires amending the state constitution, would cause wealthy people and small businesses to leave Illinois.

Sixty-four percent of voters said they favored the surcharge in an advisory referendum in November.

Illinois currently has a flat income tax rate, as is mandated by the constitution. A leading top Democrat, Sen. Don Harmon of Oak Park, has a proposal to amend the constitution that would move Illinois to a graduated income tax, in which rates go up based on income brackets. That plan hasn't advanced at all, but there's plenty of time for both, considering the election isn't until next year.

Gov. Bruce Rauner has opposed the millionaire's amendment concept, and has further refuse to negotiate about any tax increase until his Turnaround Agenda has passed. Republicans continue to accuse Democrats of stonewalling negotiations on that pro-business platform. 

  • Amanda Vinicky contributed to this report.