Wait, What's the Illinois Fair Tax?
First, some background info. If you haven't been following this issue, here's the skinny.
Illinois currently has a flat tax system for income taxes, which means that everyone, rich or poor, pays the exact same rate. (If that sounds fair to you, you should know that, in fact, most people believe that a flat tax system is unfair.)
If the Illinois Fair Tax passes, Illinois would be able to tax wealthier individuals at a higher rate and tax lower-income and middle tax families at a lower rate.
When certain sectors of the economy are doing really well, Illinois would benefit from that, whereas now it currently must tax everyone the same regardless of whether they are doing well or going through tough times.
So Why Is the Illinois Fair Tax Good for Business?
A report that assessed the impact of the Illinois Fair Tax, prepared by the Center for Tax and Budget Accountability, found that "the data indicate that Illinois' lack of tax fairness has both contributed materially to the state's ongoing General Fund budget deficits and harmed Illinois' private sector economy."
That's right. The flax tax has caused many of Illinois' current problems and has harmed the private sector.
If only to improve Illinois' image on the national scene, you should vote for the Illinois Fair Tax.
We all know that negative PR can create a vicious cycle in which a bad image leads to additional problems that further strain the image and the brand. That's exactly what has happened in Illinois, and the biggest culprit is the flat tax that Illinois enacted in 1969.
Because of that flat tax, it became impossible to raise much money from income tax.
Despite what you might have heard, Illinois taxation is low, and Illinois spending is reasonable. (Much of the negative narrative saying otherwise comes from provocateurs that are not even from Illinois, but who want to propagate a worldview that they believe in.)
Without the ability to raise enough revenues from taxes, Illinois has underinvested continually in key investment areas like education, health, safety, the environment, social services, infrastructure and economic development.
That underinvestment has been bad for business.
It makes it harder to hire good skilled workers. It puts more of a burden on business owners to train workers and help them to stay healthy. Poor infrastructure has been a handicap, making it harder to ship and receive goods effectively, but continued neglect threatens to really undermine the Illinois economy as companies choose alternative shipping routes or decide to locate companies in other states that have infrastructure that is more modern and better maintained.
For the reasons outlined above, fixing the broken tax system will be good for business.
But, circling back to the discussion of Illinois' image, that will be one of the biggest benefits for business owners. I'm a business owner myself and I'm a bit tired of Illinois having become the butt of late-night talk show hosts' jokes. When your state's brand becomes a laughing stock in the country, you can be assured that your company brand gets tarnished too.
To thrive in the future, Illinois needs to rebuild its brand as an economic powerhouse, and getting fiscal issues fixed is the key.
You can't fix the fiscal problems in Illinois without additional revenue, and the Illinois Fair Tax does that, with a modest ask of those who are doing well to do a little more heavy lifting for the greater good, and for their own good frankly.
Only business owners netting $250,000 or more in personal income (this has no effect on business tax rates) will pay a bit more in taxes.
Struggling entrepreneurs and business owners will finally get a little help and can pay less than they might have with the archaic flat tax. That's also good for business.
The improvements in the state, the uplift in the state's image and a break for struggling business owners -- these are just three of the reasons I believe that the Illinois Fair Tax is great for Illinois business owners and the Illinois economy.
Ethically and morally, it's also just the right thing to do, as the current tax system, in its entirety, is one of the most unfair tax systems in the country to lower-income families.
For business owners, they can do good and do well by voting for the Illinois Fair Tax. Opponents to the Illinois Fair Tax keep trying to say it's bad for business, but that's clearly wrong. If you're pro-business, you should vote for the Illinois Far Tax.
Trying to understand the pros and cons of the Illinois Fair Tax? If so, you'll enjoy these Illinois fair tax resources:
Illinois Fair Tax Solves Illinois' Problems
Illinois Fair Tax Helps Small Business
Advantages of Passing the Illinois Fair Tax
Arguments for the Illinois Fair Tax
Illinois Fair Tax Small Business Impact
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