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Too close to call on Illinois graduated tax question (copy)

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SPRINGFIELD — With 20% of precincts reporting Tuesday night, 55% of voters were against a ballot measure to allow a graduated tax in Illinois, according to unofficial results.  

The far-reaching ballot proposal has triggered millions of dollars in TV ads paid for and against the change to the Illinois Constitution. That would allow a change from the current flat-rate income tax, now 4.95% on individuals regardless of how much they make, to a tax that increases as income rises.

The proposal needs either 60% support among those voting directly on the question or more than 50% support of those voting in the election.

The contentious ballot measure triggered a wave of advertising spending. It was a major policy focus of the governor, who warned that if the amendment failed, the state faced a general flat-tax increase, 15% across the board cuts in state spending, or other measures.

Pritzker calls it the “fair tax” because it would raise taxes only on the 3% of residents who are the wealthiest. But critics, who have nearly matched the $50 million in spending on ads that billionaire Pritzker put up in favor of the plan, say it is simply a blank check for free-spending Democrats and won't be used to pay down debt.

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The state has had a pile of overdue bills to vendors and service providers for years, which currently stands at more than $8 billion. Its five pension programs are underfunded by more than $130 billion and the current state budget spends $5 billion more than it takes in because lawmakers were counting on a second COVID-19 relief grant, which Congress has yet to approve.

Critics also say the rich will simply leave, forcing the government to raise taxes on lower-income payers and that the graduated tax structure hurts small businesses which pay individual income taxes.

Democrats who control the General Assembly have approved a rate structure. Those earning less than $250,000 would pay the current 4.95% rate or less. Those making more than $250,000 would pay higher percentages as income increases, topping out at 7.99% for individuals with incomes over $750,000. The corporate tax rate would increase from 7% to 7.99%.

The Associated Press and Capitol News Illinois contributed to this report. 


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