With 93 percent of votes counted, it appears the Illinois Fair Tax Amendment did not pass in the general election. Gov. J.B. Pritkzer’s ballot initiative garnered 45 percent support, falling short of the 60 percent threshold required to pass.
What was the outcome of the Fair Tax Amendment in Illinois?
With 98% of precincts reporting, 2,747,250 voters (55%) voted against the measure and 2,242,164 voters (45%) voted in favor. The amendment would have supported allowing the state government to impose a graduated-rate income tax structure that would tax different brackets of income at different rates.
Will the Illinois Fair Tax tax pensions?
FALSE: The Fair Tax is a tax on retirement income. FACT: Fair Tax reform does not allow taxes on retirement income. Illinois currently doesn’t tax any retirement income such as 401(k), IRA, pension or Social Security benefits. Passing the Fair Tax won’t change that.
Does Illinois raise taxes without voter approval?
Very few states require voter approval for tax increases, because that job normally rests with the legislature. In Colorado, a 1992 law requires state and local governments to get permission from voters before raising taxes or exceeding certain spending limits. But Illinois has never had such restrictions.
What is the fair tax law in Illinois?
The Illinois Fair Tax was a proposed amendment to the Illinois state constitution that would have effectively changed the state income tax system from a flat tax to a graduated income tax.
Why did people support a graduated income tax during the Progressive Era?
As the rift between the wealthy and poor widened, numerous groups began to support the idea of a national graduated income tax (a tax that would collect a higher percentage from people who made more money) to help fund government programs and create a better balance between the rich and poor.
Is Fair Tax a Good Thing?
The FairTax plan may be advantageous to many groups, especially the wealthy and those at or below the poverty line. Significant benefits include: Paying Tax Only on What You Spend. Our tax system is currently based on tax brackets: The more you make, the more you pay in taxes.
Can Illinois lawmakers raise taxes?
REVENUE. SECTION 1. STATE REVENUE POWER The General Assembly has the exclusive power to raise revenue by law except as limited or otherwise provided in this Constitution. The power of taxation shall not be surrendered, suspended, or contracted away.
Will Illinois Fair tax affect retirement income?
Illinois is one of three states that levies an income tax but does not impose it on retirement income, such as pensions and IRA and 401(k) plans.
Can Illinois currently tax retirement income?
Nine of those states that don’t tax retirement plan income simply have no state income taxes at all: Alaska, Florida, Nevada, New Hampshire, South Dakota, Tennessee, Texas, Washington and Wyoming. The remaining three — Illinois, Mississippi and Pennsylvania — don’t tax distributions from 401(k) plans, IRAs or pensions.
How can I avoid paying tax on my pension?
Employers of most pension plans are required to withhold a mandatory 20% of your lump sum retirement distribution when you leave their company. However, you can avoid this tax hit if you make a direct rollover of those funds to an IRA rollover account or another similar qualified plan.