In mid-April, lawmakers received some very welcomed news. We learned that the state’s income tax receipts for April were $1.5 billion higher than projected and that next year’s revenues were revised upwards by $800 million. The improved revenue outlook is due largely to federal tax law changes and a strengthening national economy. Just think of how our state coffers could grow if we followed suit and used economic prosperity as our revenue-generator rather than tax increases!
The additional tax receipts from April translate to a 38 percent boost in monthly tax revenue as compared to April of 2018. It’s a substantial sum that now puts Illinois on a path to end the fiscal year with a surplus. That’s right. I said surplus.
Moreover, this surplus, along with the revised revenue projections for next year, provides the mechanism through which next year’s budget can be balanced without new taxes or fees. House Republicans acknowledge this new revenue outlook and are committed to working in a bipartisan manner on a balanced budget. With reliable numbers in hand, we are confident we can send the governor a balanced budget that addresses key priorities within our existing tax structure.
Despite this good financial news, as of this writing many majority party legislators are not backing away from efforts to significantly raise taxes on Illinois families and job creators. In addition to their desire to eliminate the flat tax protection from the Illinois Constitution in favor of a graduated income tax that would allow for a $3.5 billion tax hike on small businesses and families, they are still pushing for a variety of other new and expanded taxes. They’re doing this while working feverishly to gain support on high-ticket revenue items like the legalization of recreational marijuana, expanded gaming, a motor vehicle tax hike and sports betting.
Both parties should be at the negotiating table, because when we work together in good faith we can reach consensus on good legislation, including budgets that move our state forward. We did this with last year’s budget and the result was a balanced budget that now shows a projected surplus.
By the time this column is published, session’s adjournment date of May 31 will have passed. Did the majority party acknowledge the new revenue numbers and provide Illinoisans with a desperately-needed reprieve from tax hikes? Was a balanced budget sent to the Governor? Or did majority party lawmakers ignore the revised revenue forecast information and plow forward with their insatiable appetite for spending and new revenue? Stay tuned.