Two Illinois House Republicans have put forth a tax credit proposal to help the state’s families to deal with rising inflation.
Dixon Representative Tom Demmer and 95th District Representative Avery Bourne introduced an “inflation relief” tax credit would provide payments ranging from $200 to $400, depending on income and tax filing status for Illinois families.
Demmer says the credit on next year’s taxes could be used from everything from groceries to gas: “$400 won’t make all the problems go away, but it could have a positive impact. It could be an extra week or two of groceries. It could be an extra few [dollars toward] utility bills. It could be the difference between being able to buy new shoes or a new winter coat for your kids.”
Bourne says Illinois families are especially feeling the record-high inflation: “Kiplinger has rated Illinois as the least tax friendly state for middle class families. While inflation is definitely impacting families across the country, it’s acutely impacting families here in Illinois that are already burdened with higher taxes. We hear a lot of stories at this time of year with inflation about how much the cost of Thanksgiving meals are going to go up, or how much Christmas gifts are going to go up, but it’s so much more than that. It’s groceries every single day and the cost of being able to heat your home.”
The plan wants single-filers making up to $75,000 to get a $200 tax credit. Joint filers making up to $150,000 would get $400 under the plan, and heads of households bringing in up to $112,500 would get $200.
Bourne and Demmer estimate this proposal to cost roughly $1.4 billion. Demmer says the state can afford the tax credit with one of two options: “We have a few options today. The first is to consider the Covid relief dollars the State of Illinois received from the federal government. We received over $8 billion in federal Covid relief funds over which the state has significant control over and authority. During this year’s budget, the Democrats in the legislature thought it was wise to include a billion dollars of member-initiative capital projects in Democrat-only districts using some of those limited Covid relief dollars we received from the federal government. We think it’s fair to question the wisdom of using that, especially considering that 2 years ago, Illinois enacted its own capital bill. We could repurpose those dollars away from capital projects that are not related to Covid and instead direct [them] to taxpayer relief for families in every district in every part of Illinois.”
Demmer says the second option is to use the extra money the state is reporting in overall revenue to help Illinois families. The proposed legislation is expected to be filed prior to lawmakers’ return to the Capitol on January 4th. Bourne went on to argue that the bill should be a bipartisan priority for both chambers of the General Assembly. Bourne and Demmer said they would be reaching across the aisle to work on the proposal within the next few weeks.