Illinois lawmaker proposes income tax changes

Illinois Proposed Tax ChangesThe income tax plan would require a constitutional amendment be passed by Illinois voters in November.

A proposal, sponsored by House Deputy Majority Leader Lou Lang (D), is currently being consideration in Illinois that would convert the state’s single-rate individual income tax into a four-bracket tax with a top rate of 9.75 percent on individuals and 11.25 percent on small businesses. The current rate in Illinois is 3.75%.

Because the state constitution currently prohibits a graduated-rate income tax, the proposal currently being considered is contingent on voter ratification of a constitutional amendment lifting the restriction. Lawmakers need to vote on the measure by Tuesday so that that bill has enough time to pass the Illinois Senate so it can get on the ballot for November.

By comparison, Missouri currently has a top tax rate of 6%. The proposed top tax rate of 9.75% in Illinois would make it the second highest rate in the country, right behind California.