Its no secret that Illinois Gov. Rod Blagojevich (D) has proposed the largest tax increase, spending increase and borrowing increase in state history. And really, is anyone surprised by this? Everyone knows the State is facing a major fiscal crisis compounded largely by this administrations bad habit of borrowing and spending. But heres what you havent heardthe governors $61 billion budget will be solely funded by YOUas a tax on your business or by increasing your monthly household bills or by your childrens children paying down the states debt because the governor refuses to live within the States means.
Based on the information we have at this time, the governors gross receipt sales tax proposal would tax businesses if their annual income is more than $1 million. The governor argues this is a tax fairness plan, but everyone knows that if businesses are taxed, one of two things will occur 1. They will leave, creating a tremendous hardship on their communities and the State, which is a huge concern since Illinois already ranks 44th in the nation for job growth, or 2. They will raise their prices and pass the cost to YOU and YOUR family. It is estimated that the governors receipts sales tax will cost the average family between $1,000 and $3,000 per year. Illinois families cannot afford this, especially not middle-class families. Illinois businesses cannot afford this. The Illinois economy cannot afford this. With the exception of food, everythingI repeateverything will be taxed. The governors gross receipts sales tax is estimated to raise between $6 and $9 billionyes, BILLIONper year.
The governor is also planning to raise $16 billion from selling the States pension obligation bonds for a SECOND time. Since taking office in 2003, the governor has doubled our debt. If he is successful with this proposal, he will quadruple the States debt despite countless warnings that the State is in a very dangerous position. As with your personal finances, if you over borrow, there comes a point when the banks realize you cannot afford it. The State is dangerously close to that point. The State should not borrow any more, especially since past borrowing has been used for short-term spending rather than capital improvements. These are long-term debt obligations that are being used for the States weekend shopping list. Consequently, our childrens children will be paying for the governors shopping spree.
The governor requested an unprecedented $61 billionBILLIONfor spending without offering meaningful property tax relief, money for road construction or to pay down Medicaid bills. This budget proposal is bad for business, bad for Illinoisans, and bad for our future.
from the April 11-17, 2007, issue