Beaubien Disturbed at Greg Hinz Story Pinning Him with Pension Income Tax Idea
by Cal Skinner
Friday, Crain's Chicago Business political reporter Greg Hinz wrote a story that certainly sounded as if State Rep. Mark Beaubien was proposing taxing pensions.
Since Beaubien represents the mid-eastern part of McHenry County, I posted a story on McHenry County Blog. Right up front, I even admitted my self-interest--having a generous pension after 20 years as an elected official and 4 in the state bureaucracy. (I thank you Illinois taxpayers.)
Monday morning Beaubien called to vehemently deny that the pension tax hike idea was his and state that he did not endorse it. Naturally, I put up his reaction.
I note that Hinz, not someone whom anyone would confuse with a conservative, found “financial experts” to support the idea of raising
“about $900 million a year by taxing retirement payments above $50,000 and pensions paid to any one who retires before age 65.”Beaubien was telling Hinz the idea is being discussed.
Combined with a 67% income tax rate hike (from 3 percentage points to 5 percentage points), that would cut retirement income by 5%--about $3,500 for me.
I imagine there are a lot of retired teachers that might be interested in the idea.
I further predict that, if passed, a lot of retiree pigeons will fly the Illinois pension tax coop. No way for the General Assembly to close that door.
Maybe a legislator will push for making the pigeon the state bird. It would be more appropriate than the cardinal.
1 comments:
Well, Cal, I'm one of the "experts" I think Greg quoted, so I better speak up. I made 4 simple points, all of which are indisputable, I believe.
One, older Americans are relatively affluent, and they are(not wealthy, but compared to other segments of the population, not poor).
Two, our income tax in Illinois is not confiscatory, and its not, whether at 3% or 5%.
Three, no one except retirees get $50,000 of their income disregarded for tax purposes.
And four, the state is going to be taking more money from someone in the near future. I don't think senior citizens need a 100% pass on that.
I'm sure the great majority who will comment disagree, and that's OK. I simply believe that too much attention is spent on how much we tax, at the expense of looking at how we tax and how we spend. I know the "starve the beast" theory of containing government growth, and like most simplistic solutions it results in real distortions in tax and public policy.
For example, in the past 6 years we imposed a huge "tax increase" on middle class parents sending their children to public universities, where tuitions have grown at double digit rates, partially because we preferred a governor who promised he would never raise income and sales tax.
I happen to believe that investment in public higher education is a public good, and therefore should be broadly supported. I suspect the public generally agrees with that sentiment, but not at the expense of a Governor who won't raise taxes.
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