Simon Poll: Illinois voters favor graduated income tax, ‘millionaire’s tax’
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Paul Simon Public Policy Institute | State Tax Polling

Simon Poll: Illinois voters favor graduated income tax, ‘millionaire’s tax’

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Pritzker

Gov. J.B. Pritzker speaks during a news conference from his Illinois State Capitol office in March while proposing rates for a graduated income tax structure. In releasing the Pritzkers’ tax returns summary Tuesday, the governor’s campaign touted the governor’s signature tax overhaul proposal, claiming the Pritzkers and trusts benefiting the family would have paid an additional $2.8 million in state taxes under proposed graduated income tax rates.

Illinois voters favor a graduated income tax by a two-to-one margin, according the most recent poll released by the Paul Simon Public Policy Institute at Southern Illinois University, a news release from the university said Tuesday.

The Simon Poll was based on a statewide sample of 1,000 registered voters conducted March 11 through March 17. The margin of error is plus or minus 3.1 percent.

Respondents also endorsed a related proposal for adding a 3 percent increase to all income over $1 million per year. Both these proposals are being advocated by Gov. J.B. Pritzker as part of his plan for dealing with the chronic structural deficits Illinois has run since the turn of the 21st Century.

Sixty-seven percent of Illinois voters said they favored the graduated tax plan, “… that is, tax rates would be lower for lower-income taxpayers and higher for upper income taxpayers.” Just under one-third (31 percent) opposed the plan. The plan received high levels of support across all three major geographic divisions of Illinois with the highest level of support coming from Chicago (74 percent). Voters in suburban Cook and the collar counties supported the plan by a 68 percent to 31 percent margin, while 60 percent of downstate voters supported and 37 percent opposed the plan.

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In the partisan breakdown, 88 percent of Democrats and 65 percent of Independents favored the plan, while 55 percent of Republicans opposed and 43 percent supported the plan. Only 10 percent of Democrats opposed and 31 percent of Independents opposed the graduated income tax plan.

When asked a related and more specific plan for increasing the income tax by 3 percent on all incomes over $1 million annually, 71 percent of voters statewide favored and 27 percent opposed the so-called “millionaire’s tax,” while 27 percent opposed.

The 3 percent surtax on $1 million incomes was favored by majorities of all three geographical regions and of all three partisan groups. Seventy-five percent of Chicago voters favored while 24 percent opposed this proposal; seventy-one percent of suburban voters in Cook and the collar counties favored and 27 percent opposed. Downstate, the plan was favored by 70 percent and 29 percent opposed. Democrats favored the tax increase with 90 percent supporting the measure, compared to only 9 percent in opposition, while 69 percent of Independents supported and 27 percent opposed. Somewhat surprisingly, a bare majority (51 percent) of Republicans supported and 47 percent opposed.

“Gov. J.B. Pritzker ran on the graduated income tax as the centerpiece of his plan for providing a solution to Illinois’s long-term budget crisis. After he was elected Pritzker unveiled his specific brackets for those who would see some tax reductions, those who would see no differences, and those who would have to pay up to three percent more. Those with over $1 million dollar per year annual incomes would pay the bills, according to the governor,” John S. Jackson, one of the directors of the poll, said in the news release. “This campaign is just starting, and those forces in favor and opposed to the plan are gearing up for the referendum on a constitutional amendment that would be required if the General Assembly approves this fairly audacious solution. Here we have a benchmark of where the public stands at the outset of that contentious campaign."

Aside from depending on the graduated income tax as the governor advocates, there are other routes to raising increased revenue, several of which are being considered this term in the legislature. Those sources would produce immediate revenue increases for the next two fiscal years. The poll also assessed most of those possible sources of new revenue.

At the top of this list is the proposal to legalize recreational marijuana and regulate and tax it like alcohol. This has become a top legislative item for the Pritzker administration. Sixty-six percent of the respondents favored or strongly favored the plan while 32 percent opposed.

The differences in levels of support are not particularly large by region, but they are in the direction expected. The highest level of support is in Chicago, where three-quarters (75 percent) favored it and 24 percent opposed. The next highest level of support was in suburban Cook and the collar counties with 67 percent favoring and 31 percent opposed. The lowest support levels were downstate, but here, too, the support was well above a majority, at 57 percent favoring with 39 percent opposed.

The partisan differences were fairly marked and as we expected. Seventy-nine percent of Democratic respondents favored legalizing and taxing marijuana, and 65 percent of Independents favored it. The Republicans were virtually tied at 49 percent in favor and 48 percent opposed.

“This may be one of those public policy shifts — like gay marriage — whose time comes fairly quickly. Given the solid support it receives across almost all the groups we surveyed, its strong advocacy from the Pritzker Administration, and aversion to higher taxes, the legislature may feel emboldened to legalize and tax marijuana,” Charlie Leonard, a co-director of the Simon Poll, said in the release.

There has long been a movement to expand gambling in the state, and the current Simon Poll presented a generic question about it as it has in the past. This proposal received majority support statewide and across both geographic and partisan divisions. Fifty-seven percent of all respondents favored or strongly favored it, with 40 percent opposed or strongly opposed. Support was highest in the City of Chicago (65 percent), next highest in the suburbs at 56 percent, followed closely by downstate voters at 54 percent.

Support for expanding gambling was spread almost evenly across the three major partisan groups with 59 percent of Democrats, 57 percent of Republicans, and 54 percent of Independents favoring it. This is another policy shift which seems to have a good deal of momentum in the General Assembly and widespread support among the public.

A natural extension of the gambling issue is the recent drive to legalize gambling on sporting events. Several states have already legalized or are planning to legalize sports betting due to a recent U.S. Supreme Court decision favoring it. Statewide almost two-thirds (63 percent) favored or strongly favored while one-third (33 percent) opposed legalized gambling on sports events.

This is another proposal which garnered support from substantial majorities across both geographic and partisan divides. Seventy-two percent of Chicago voters favored and only 26 percent opposed it. Comparable levels of support were found in the suburbs with 63 percent supporting and 33 percent opposing and downstate with 57 percent supporting and 37 percent opposing the legalization of sports betting.

Partisan differences were relatively small also with 66 percent of Democratic voters favoring and 60 percent of Republicans favoring the proposal, leaving 60 percent of Independents supporting allowing gambling on sports events. On the negative side, 30 percent of Democrats, 34 percent of Republicans, and 36 percent of Independents opposed sports gambling.

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The possibility of expanding the base of service taxes in order to more accurately reflect the realities of a 21st Century service economy has been on the state’s political agenda for several years. Currently, Illinois only taxes 17 categories of services compared to the national average of 56 with a total of 168 categories of services taxed across all states combined. So Illinois is a low tax state in terms of taxes on services.

The Simon Poll asked if respondents favored or opposed “expanding the sales tax to cover the same services as Wisconsin currently taxes such as a sales tax on entertainment tickets, cable and internet services, landscaping and parking, which are not currently taxed?”

Statewide, 36 percent favored or strongly favored this proposal and 61 percent opposed or strongly opposed it. The highest level of support was in Chicago, where 41 percent supported and 56 percent opposed; followed by downstate where 36 percent supported and 60 percent opposed. The suburbs were marginally the lowest on level of support with 34 percent who supported and 63 percent who opposed.

Partisan differences were as expected, with 47 percent of Democrats favoring and 50 percent opposing expanding the service tax base; 30 percent of Republicans favoring and 66 percent opposing; and 29 percent of Independents favoring and 67 percent opposing.

Since the Pritzker Administration assumed office in January, there has been a great deal of discussion of and movement toward a capital plan. A significant number or other states have adopted an infrastructure plan paid for by motor fuel tax increases recently. Illinois has not had a capital plan since 2010, when Gov. Pat Quinn instituted one. Multiple reports have touted the need for new infrastructure and repair of what’s already in place. The problem is, of course, how to pay for such a plan. The most common and most likely source is an increase on the motor fuel tax.

Thirty-seven percent of the respondents favored and 61 percent opposed the gas tax increase. Support and opposition varied both by region and by partisanship. A majority 52 percent of Chicago residents favored the plan; while in the suburbs 34 percent supported it; and downstate 33 percent supported and 65 percent opposed increasing the gas tax.

Two additional questions on potential revenue sources were interrelated. The Simon Poll has consistently asked whether voters favored applying the state income tax to retirement income. The results have generally been negative on this proposition and this year was no exception. Statewide, 73 percent of the respondents said they somewhat opposed or strongly opposed making this change, while a net of only 23 percent either favored or somewhat favored.

Twenty-nine percent of the residents of Chicago favored and 67 percent opposed taxing retirement income such as Social Security. The idea was even less popular in the suburbs and downstate where only 23 percent and 18 percent respectively favored this change.

Twenty-nine percent of Democrats favored and 67 percent opposed; while 18 percent of Independents and Republicans supported with over 70 percent opposed in both groups.

The final question in the search for possible sources of new revenue is a variation on taxing retirement. It tested the proposition of putting a tax on retirement income if the first $100,000 were exempted from the tax. It was only asked of those respondents (N = 732) who had indicated they were opposed to taxing retirement income in the previous question. Here the statewide division was much closer with 36 percent favoring and 34 percent opposed. There were essentially no notable differences by place of residence or partisanship.

“New taxes have never been popular in the United States or in the State of Illinois," John Shaw, director of the Paul Simon Public Policy Institute, said in the release. "Several proposals tested in this poll showed the same pattern. However, it is clear that the general idea of a graduated income tax is strongly supported. This support is further buttressed by the proposition that those Illinoisans earning the most could bear a three percent tax on the increment of their incomes above $1 million per year.”

It is also notable that there is typically support for so-called “sin taxes,” such as taxes on gambling and marijuana consumption. These new proposals are a significant part of Gov. Pritzker’s plan for closing the revenue gap with new revenue sources in the FY 2020 and 2021 budgets. These could take place in advance of any change in the state’s flat rate income tax, which would require both legislative action and a statewide vote to amend the Illinois Constitution.

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