Institute on Taxation and Economic Policy

ITEP Work in Action

Scholars Strategy Network: Tax Policy as a Potential Tool for Reducing Infant Mortality

April 17, 2024

Increased tax revenues and increased tax progressivity need to be further explored as policy solutions in Illinois. More specifically, the adoption of worldwide combined reporting and a state-level child tax credit, could help prevent infant deaths in our state.

Chicago Resilient Families Task Force: EITC Expansion and Modernization

February 28, 2020

Expanding and modernizing the Earned Income Tax Credit will put more money back in the pockets of the people who need it most. Recent polling suggests such policies would be popular, with 70% of respondents supporting a modernized EITC statewide and 80% supporting such an effort in Chicago. Read more

Chicago Resilient Families Task Force: Big Shoulders, Bold Solutions: Economic Security for Chicagoans

February 25, 2019

People with low and middle-incomes are financially savvy in ways that are often underestimated, but despite this are on thin ice financially. Despite doing all the right things, they are caught in a trap that is very hard to escape. Wages are falling behind and jobs are increasingly structured in ways that foster precariousness instead […]

Voices for Illinois Children November Newsletter

November 21, 2018

The Institute for Taxation and Economic Policy (ITEP) released the sixth edition of its “Who Pays?” report on state tax systems. Voices’ policy analyst John Gordon detailed the findings of the report in a blog post. Illinois ranks #8 among ITEP’s “Terrible Ten” in terms of regressive state tax systems.

Cherokee Tribune & Ledger-News: Financial Watchdog: Pritzker’s Spending Promises Would Raise Taxes on Middle Class

November 1, 2018

The Institute on Taxation and Economic Policy says Illinois has one of the most regressive taxes in the nation, largely due to its flat income tax. In its annual “Who pays?” report, the institute said the poorest 20 percent of Illinois households pay 14 percent of their income in taxes because of the flat tax in addition to high sales and property taxes.

Voices for Illinois Children: Who Pays In Illinois? Mostly The Poor And Middle Class

October 29, 2018

A new report from the Institute of Taxation and Economic Policy (ITEP) shows the poorest 20 percent of Illinois households pay nearly twice as much in state and local taxes as the richest one percent. As a result, ITEP ranks Illinois as the eighth most regressive tax system in the country.

News and Tribune: In Indiana and Illinois, Taxes Hit Low-earners Hard

October 25, 2018

TERRE HAUTE -- Low-earning residents of Indiana and Illinois pay a greater share of state and local taxes than those in all other Midwestern states, and those in most states nationally, according to a new study by a non-partisan think tank.

Center for Tax and Budget Accountability: Cutting Taxes for the Middle Class and Shrinking the Deficit

April 30, 2018

According to the Institute for Taxation and Economic Policy, Illinois ranks as the fifth-most-regressive state and local tax system in the country — and the most regressive in the Midwest. In Illinois, the top one percent of income earners pay just 4.6 percent of their income in state and local taxes, while the middle 20 percent of workers pay more than double that, coming in at 10.8 percent of income, and the bottom 20 percent of earners have almost three times the tax burden of the wealthiest, coming in at 13.2 percent.

Voices for Illinois Children: Fair Tax Bill Introduced

January 9, 2017

Representative Lou Lang introduced a fair tax rate structure (House Bill 689), which would provide over 99% of income taxpayers with a tax cut while raising $1.9 billion to prevent more harmful budget cuts. Read more here

Voices for Illinois Children: Avoid Cuts, Choose Revenue

May 7, 2015

Governor Rauner has proposed to close this massive gap through damaging cuts to essential programs and services that strengthen Illinois families, children, communities, and our economy — including child care and early intervention services, K-12 education, afterschool, child protection and welfare, public health, higher education, health care, public transportation, and revenue-sharing with local governments. Cuts […]

Fiscal Policy Center: Fair For Whom? IL Taxes the Lowest Earners at the Highest Rates

January 21, 2015

As part of his campaign platform and “Jobs and Growth Agenda,” Governor Rauner has identified the need to “overhaul the tax code so that it’s fair to all taxpayers.” We couldn’t agree more. Considering all major state and local taxes Illinoisans pay, those who earn the least — less than $19,000 a year — pay […]

Voice for Illinois for Children: Congress Must Act to Stop Corporate Inversions

July 30, 2014

A number of high-profile U.S. corporations have, or are reportedly considering, corporate “inversions,” where they move their “headquarters” overseas to avoid paying U.S. corporate income taxes. Unless Congress acts, federal and state governments are set to lose, at minimum, tens of billions in revenue to support urgent priorities such as schools, roads and bridges, and […]

Voices for Illinois Children: Double the EITC to Make Illinois Taxes Fairer (Among Other Great Things)

May 22, 2014

The more money you make in Illinois, the lower share of it you pay in state and local taxes. If that sounds unfair, that’s because it is. In fact, low- and middle-income workers pay, on average, two to three times the percentage of their income in state and local taxes that the wealthiest Illinoisans pay. […]

Voice for Illinois for Children: Improving Tax Fairness Through Income Tax Reform

April 15, 2014

When adding up the effect of all state and local taxes, Illinois asks middle- and low-income households to pay a percentage of their income that is two to three times higher than the highest-income households pay. It doesn’t have to be this way. We can all pay our fair share to make sure Illinois has […]

Voices for Illinois Children: Profitable Companies in Illinois Not Paying Their Fair Share of State Income Taxes

March 20, 2014

Over the past five years, many profitable Fortune 500 corporations, including several based in Illinois, paid little or no state income taxes to any of the states in which they do business thanks to copious loopholes, lavish giveaways, and crafty accounting. That’s the conclusion of a new report, released by Citizens for Tax Justice and […]

Voices for Illinois Children: New FPC report — tax cuts won’t improve the economy or create jobs

March 12, 2014

Allowing current state income tax rates to expire will cause a revenue collapse that would threaten Illinois’ economic recovery, curtail the ability to support vital investments, and create more uncertainty over how the state will meet its many obligations, a new FPC report released today finds. Read the Full Report

Fiscal Policy Center: Profitable companies get free pass on federal income tax

February 27, 2014

There’s new evidence that many of the country’s biggest companies are getting a free pass on taxes, including several businesses headquartered here in Illinois. In fact, many of these profitable companies actually received money from the federal government. Read the Full Report

Center for Tax and Budget Accountability: Issue Brief: Why Taxation in Illinois is Unfair

January 15, 2013

Tax policy is by its nature a contentious subject. In the end, individuals pay different proportions of their incomes in taxes to fund public services and a completely different matrix of individuals used those services. Given this dichotomy, establishing a definition of what constitutes the most fair way to levy taxes that is acceptable to […]

Center for Tax and Budget Accountability: Citizens Guide to the Illinois State Budget & Tax System

January 15, 2013

The Illinois State Budget is the state’s fundamental policy document. It defines what programs and services will receive financial support from the state. In a standard, non-overtime legislative year, Illinois adopts its budget on a fiscal year basis, beginning on July 1 of each calendar year and ending on June 31 of the next succeeding […]