From Jim Tobin:
Taxpayers In Springfield Protest Pritzker’s New Middle Class Taxes
Springfield–Jim Tobin, President of Taxpayers United of America (TUA), and other taxpayer activists staged a protest in the Illinois State Capitol Building on May 21.
The protest was held in opposition to the nearly endless demands for newer and high taxes proposed by Gov. Jay Robert “J. B.” Pritzker and other tax thieves.
Tobin, who spoke to the crowd at the protest, had harsh words for the current Illinois Governor.
“Pritzker promised not to increase taxes on the middle class,” said Tobin.
“He lied!
“Pritzker’s $2.4 Billion gasoline tax increase is a tax increase on the middle class.”
Pritzker has promised many new regressive taxes that will largely hurt the poor and middle class.
As reported by the Chicago Tribune, some of the new taxes could be placed on ride-sharing, cable streaming, alcohol purchases, plastic bag usage, parking garage fees, cigarettes, electric vehicles, car registration fees and gasoline.
These taxes are all regressive in nature, as they take up a larger share of an individual’s income compared to other taxes.
Of all the regressive and anti-middle class taxes being pushed however, the taxes for “road improvement” is the worst scam that Pritzker is pushing.
As exposed in a Taxpayer Education Foundation study, a large part of the gasoline taxes collected in Illinois are funneled into the bloated bureaucracy that is Chicago government transit.
This money is being stolen from non-Chicago taxpayers to fund lavish government employee pensions and subsidize an obsolete, 19th Century transit system.
“The corpulent con man Pritzker is no savior of the middle class,” said Tobin.
“He is determined to pillage the Illinois middle class to enrich the Chicago government class. This is irresponsible and legalized theft on a statewide scale.”
“That is why these grassroots protests are so important, now more than ever. We need to show Illinois government that Illinois taxpayers will resist new tax increases every step of the way.”
The proposed gas tax hike is Senate Bill 103 (SB 0103) in the 101st Illinois General Assembly (ILGA).
There may be other such bills as it is not unusual in the ILGA to have multiple bills for the same or similar purposes.
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As the result of an Illinois state constitutional amendment passed in 2016, transportation funds such as gas tax revenues (and thus gas tax hikes) can only be used for transportation purposes.
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Here briefly is how the state constitution was amended to earmark for instance gas tax hike revenues for transportation spending.
The legislative process resulted in the passing of House Joint Resolution Constitutional Amendment 36 (HJRCA 36) in the 99th GA.
That resulted in the placement of a statewide referendum question, known as the Illinois Transportation Taxes and Fees Lockbox Amendment, on the November 8, 2016 ballot.
That referendum successfully passed.
A group supporting the referendum called it the Safe Roads amendment.
Many unions supporting increased spending on road construction and maintenance, such as IUOE Local 150, supported the amendment.
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Here is the substantive transportation language that appeared on the November 8, 2016 referendum ballot.
“The proposed amendment adds a new section to the Revenue Article of the Illinois Constitution.
The proposed amendment provides that no moneys derived from taxes, fees, excises, or license taxes, relating to registration, titles, operation, or use of vehicles or public highways, roads, streets, bridges, mass transit,intercity passenger rail, ports, or airports, or motor fuels, including bond proceeds, shall be expended for other than costs of administering laws related to vehicles and transportation, costs for construction, reconstruction, maintenance, repair, and betterment of public highways, roads, streets, bridges, mass transit, intercity passenger rail, ports, airports, or other forms of transportation, and other statutory highway purposes, including the State or local share to match federal aid highway funds.
You are asked to decide whether the proposed amendment should become part of the Illinois Constitution.
For the proposed addition of Section 11 to Article IX of the Illinois Constitution.”
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Looking at the big picture, that earmarked certain revenues for certain expenditures.
Such earmarking practices are increasingly common in Illinois state and local government.
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Another piece of legislation, Senate Bill 42 (SB 42) in the 100th GA, which became Public Act 100-0023 (PA 100-0023), contains two such earmarks.
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For background purposes, PA 100-0023 contained much more than revenue earmarks.
PA 100-0023 was 1 of 3 parts of the state budget passed in July of 2017.
It was the budget implementation (BIMP) portion of the budget (appropriations and revenue being the other two portions).
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Here is one example of how PA 100-0023 enabled the earmarking of revenues by a local unit of government.
PA 100-0023 enabled the City of Chicago to create an entity (Sales Tax Securitization Corporation aka STSC) for the purposes of making payments to bondholders.
The STSC appoints a trustee to handle the money.
STSC and the trustee are thus middlemen.
STSC is a bankruptcy remote special purpose entity (SPE).
The stated reason for creating STSC was for the City of Chicago to receive a lower bond interest rate, as the practice earmarks sales tax revenue for bond payments and provides further protections for bondholders to receive their payments.
Many including Wirepoints were and are critical of the practice.
In actuality it’s more complicated and that is not a 100% accurate description of how it works.
The above is just a high level over simplified overview.
In conclusion it earmarked state sales tax revenues.
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The point being state and local governments in Illinois are creating all sorts of financial schemes due to the financial difficulties facing the state and many local units of government.
Time will tell if that is a good idea or not.
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PA 100-0023 also authorized the state to issue income tax proceed bonds to make certain payments, another initiative earmarking certain government revenues for certain categories of government expenditures.
More information here:
McHenry County Blog
Rauner Plans to Borrow $6 Billion to Pay Bills
September 7, 2017
mchenrycountyblog.com/2017/09/07/rauner-plans-to-borrow-6-billion-to-pay-bills
In summary that earmarked state income tax revenues.
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Let’s say voters approve a constitutional amendment creating an adjustable state income tax.
And that, via an associated bill, triggers hiked income tax rates for upper incomes only initially.
The state then has another state income tax revenue stream which can be securitized for the purposes of issuing state income tax proceed bonds.
In summary, the state could again earmark state income tax revenue.
I’ll be buying gas in Genoa City, WISCONSIN.