Illinois Speaker Proposes Tax On Millionaires

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Two days after Illinois Republicans chose a multimillionaire as their candidate for governor, the powerful Chicago Democrat who controls the Illinois House proposed a tax on millionaires Thursday to fund the state’s financially strapped education system.

House Speaker Michael Madigan introduced a constitutional amendment to tack a 3 percent surcharge onto incomes over $1 million, which he said would raise $1 billion a year for elementary and secondary education – about $550 per student.

Madigan announced the idea in a state Capitol news conference just as one of the nation’s most competitive governor races is heating up between Republican Bruce Rauner, a wealthy private-equity investor, and Democratic Gov. Pat Quinn, who espouse starkly contrasting visions of how to fix the lagging economy of the Democratic stronghold.

The proposal by the speaker, who doubles as state Democratic Party chairman and has controlled the House for nearly all of the last 30 years, intensifies an ongoing debate over tax policy in Illinois less than a week before Quinn delivers a budget address. The governor is expected to use the speech to lay out how he plans to deal with a temporary income-tax increase that’s set to expire halfway through the year, leaving a budget hole as big as $3 billion.

“I just happen to think that this is a good idea, I’ve given a lot of thought to this,” Madigan said. “I think it makes sense. What we’re doing here is calling upon people in Illinois that are well-equipped to provide support for education, which is available to everybody in the state.”

Rauner campaign spokesman Chip Englander said Rauner is happy to pay more for schools and has given millions of dollars to education over the years, but he won’t support Madigan’s proposal.

“The last time they raised taxes, they hit every Illinoisan with a 67 percent increase, and they still turned around and cut funding for education,” Englander said in a statement. ” … We need to take a look at our entire tax system to make Illinois more competitive and lower the tax burden on the people of Illinois.”

Madigan denied that the proposal was a shot at Rauner. He argued that he has long been a supporter of education funding.

“I’ve been here (in the House) for 44 years, and I’ve voted for every tax for education,” Madigan said. “Think about that for a while. Over 44 years, whenever there’s been a bill that would raise or impose a tax for education, I’ve voted `yes.'”

Quinn wouldn’t express an opinion on the initiative, saying he would “take a look at the details.”

Quinn, who has made a political career as a populist and defender of the middle class, has increased taxes and pushed for raising the minimum wage. Rauner, who says the best way to help working people is to improve the business climate, wants to curtail government unions much like a fellow Republican, Wisconsin Gov. Scott Walker, did.

Quinn has repeatedly noted Rauner’s wealth in public appearances, and criticized him for changing his position on the minimum wage – a key legislative priority for the Democratic governor. Rauner accuses Quinn of “class warfare.”

Madigan wouldn’t disclose his position on the state’s temporary income tax, which would drop from 5 percent to 3.75 in January if allowed to expire, nor would he express an opinion about whether Illinois should adopt a graduated income tax.

The constitutional amendment would have to be approved by supermajorities in the House and Senate to make it to the November general election ballot, where voters would decide whether to change the Constitution.

Madigan said he estimates that in 2011, there were 13,675 people in Illinois with adjusted gross incomes over $1 million. Income up to $1 million would be taxed at the current rate, but any income over $1 million would be subject to the 3 percent surcharge.

The money would be distributed on a per-pupil basis and works out to about $550 for each student in grades K-12.

Although Democrats hold supermajorities in both Houses – 71 in the House and 40 in the Senate – Madigan said he expected his idea to win support from the GOP.

“I would think that there would be Republicans from areas of the state where they don’t have any millionaires and they ought to take a good, hard look at this and say, `Why not let the people decide?'” he said.

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