Going out of business: Illinois would plummet to 48th on national index under Pritzker's tax plan
Illinois’ standing in the national business community would only continue its downward spiral under Gov. J.B. Pritzker’s progressive-tax system, according to the latest findings of the Tax Foundation’s State Business Tax Climate Index.
The nonpartisan organization concludes that the state’s national rank would fall 12 spots, from 36th to 48th, should the plan the new governor has been pushing come to fruition. The business tax climate index measures a state’s level of competitiveness and structure, according to Illinois Policy Institute (IPI).
“Were Pritzker’s proposal adopted, Illinois would trail its peers in just about every aspect of its tax code,” the Tax Foundation wrote. “If businesses and individuals are leaving the state now, these policies can only make the problem worse.”
In conjunction with his first official budget address, Pritzker recently released the details of his plan, which would require an amendment to the state constitution before it could be enacted. Under the plan, tax rates for individuals could swell to as high as 7.95 percent, and up to 10.45 percent for businesses.
Illinois' higher individual ranking would fall from the 13th position in the country under its current flat-tax structure all the way down to No. 44, while the state’s corporate income tax rate would dip from 39th to 42nd.
In short, at a time when labor markets across the country are gaining steam, Illinois’ descent would be exacerbated. According to IPI, in 2018, private-sector job growth in the state was less than 1 percent, ranking it 46th out of the 50 states.
Nationally, private-sector job rates in 2018 were more than twice as high as in Illinois, with the state’s weak labor market believed to have heavily contributed to an outmigration crisis that has trended upward over the last decade.