Some Illinois lawmakers want to get out in front of a civic group’s proposal to tax retirement income
The Civic Committee of the Commercial Club of Chicago recently proposed a plan to pay down Illinois’ underfunded pension debt and balance the budget through a number of tax hikes and revenue grabs that included classifying retirement and pension payouts as regular income. Illinois doesn’t tax retirement income.
State Rep. David McSweeney, R-Barrington Hills, filed House Resolution 32 in attempt to forestall any bill that would tax such income. The bill, filed in January, says “we state our belief that the Illinois Income Tax Act should not be amended to permit taxing retirement income.”
Since the suggestion was made to tax retirement income, McSweeney’s measure has picked up sponsors Sam Yingling, Jonathan Carroll and Jerry Costello II, all Democrats, along with Plainfield Republican Mark Batinick.
“One of the few tax benefits we have in Illinois is protection for retirement income,” McSweeney said in a statement. “We do not need to hold retirees accountable for the out-of-control spending that has put our state’s financial future at risk. I will continue to fight to protect Illinois senior citizens. Instead of raising taxes, we need to cut unnecessary spending as well as reform pensions and Medicaid.”
Bob Gallo, state director for AARP Illinois, said older Illinoisans already pay their fair share of taxes.
“Illinois’ older residents also contribute to the state’s economy to the tune of $358.8 billion, or 46 percent of Illinois’ GDP, despite only making up 34 percent of the state’s population,” he said. “Illinois would be smart to consider maintaining and adopting programs and policies that keep this important economic engine in our state, rather than considering policies that drive retirees, and their contributions to our state’s economy and workforce, elsewhere.”
House Resolution 32 is waiting to be assigned to a House committee.