Institute on Taxation and Economic Policy (ITEP)

Illinois

Alternet: Corporations Are Cheating Us Out of Hundreds of Billions of Dollars How does your state stack up?

October 5, 2015

“Some states deserve special mention because of the egregious nature of their disrespect for average taxpayers. Illinois leads the way with by far the highest deficit. Just 10 companies underpaid Illinois $1.4 billion in 2014, more than the entire 2016 Chicago school system deficit. Yet Governor Bruce Rauner recently approved $100 million in new corporate […]

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State Tax Codes As Poverty Fighting Tools

September 17, 2015 • By Aidan Davis, Meg Wiehe

The U.S. Census Bureau released data in September showing that the share of Americans living in poverty remains high. In 2014, the national poverty rate was 14.8 percent - statistically unchanged from the previous year. However, the poverty rate remains 2.3 percentage points higher than it was in 2007, before the Great Recession, indicating that recent economic gains have not yet reached all households and that there is much room for improvement. The 2014 measure translates to more than 46.7 million - more than 1 in 7 - Americans living in poverty. Most state poverty rates also held steady between…

Bloomberg BNA: Individual Income Tax Insights: Fifty States of Rates – State Tax Systems Don’t Play Fair

September 15, 2015

“All state tax systems are inherently unfair, at least that is the verdict issued by the Institute on Taxation and Economic Policy (ITEP). ITEP’s 2015 Who Pays: A Distributional Analysis of the Tax Systems in All Fifty States report analyzed state and local tax systems to assess the fairness with which each system is designed […]

Lawmakers in many states have enacted "sales tax holidays" (at least 17 states will hold them in 2015), to provide a temporary break on paying the tax on purchases of clothing, computers and other items. While these holidays may seem to lessen the regressive impacts of the sales tax, their benefits are minimal. This policy brief examines the many problems associated with sales tax holidays and concludes that they have more political than policy benefits.

Cheat Sheet: 10 Worst States in America for Fair Tax Systems

July 13, 2015

Americans generally believe that higher income households should pay a greater percentage of their incomes in taxes than lower income households. Yet the exact opposite occurs. The Institute on Taxation and Economic Policy (ITEP) finds the nationwide average effective state and local tax rates by income group are 10.9% for the poorest 20% of individuals […]

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Pay-Per-Mile Tax is Only a Partial Fix

June 24, 2015 • By Carl Davis

Read this report in PDF form Introduction For years, academics and transportation experts have been discussing the possibility of taxing drivers for each mile they travel on the nation’s roads.  This “vehicle miles traveled tax” (VMT tax) could either supplement or replace the existing gas tax as the primary method of funding transportation infrastructure. To […]

The News-Herald: Amazon’s Ohio Sales Tax Collection Seen As Way To ‘Level Playing Field,’ Close Tax Loophole

June 9, 2015

Some states, however, have decided not to wait for the federal government to make the change. So far, 10 states have taken their own limited steps to expand the number of retailers that must collect sales taxes, according to the Institute on Taxation and Economic Policy. New York was first, enacting legislation in 2008 requiring […]

Chicagoist: Addressing Property Taxes And Gentrification Along The 606

June 5, 2015

Most gentrification narratives go vaguely like this: hipsters come to a neighborhood and open up fancy businesses and build fancy stuff and the original residents get pushed out. But often there is little focus on how exactly the original residents get pushed out. Some policy institutes like The Institute on Taxation and Economic Policy consider most property […]

Stateline: Illinois “mixed” on taxes for seniors; Iowa “not tax friendly”

May 11, 2015

Despite the trend, Meg Wiehe, state tax policy director for the Institute on Taxation and Economic Policy, which surveyed senior tax breaks, said all of the efforts to have “blanket state tax preferences for elderly taxpayers is . a very ill-advised policy.” She also pointed out that states which shield retirement income – Social Security […]

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 […]

The Chicago Sun-Times: Reform Illinois’s Tax Code

May 6, 2015

Illinois citizens are not all that prosperous, either. According to the 2013 census, Illinois per capita income is a mere $29,666 prompting the question, “Just where is the average Illinois taxpayer supposed to get the money to pay those prospective tax increases, anyway?”  According to the Institute on Taxation and Economic Policy (ITEP), Illinois ranks 5th highest […]

The State Journal Register: Illinois Can Choose Revenue over Cuts

May 6, 2015

The people who will most bear the consequences of Rauner’s proposed cuts are those who can least afford to. Children, college students, seniors, the poor, people with disabilities, people with mental illness — all would be hard hit. Meanwhile, the top 1 percent of taxpayers in Illinois (average income: $1.9 million) will pay on about $18,000 less in state […]

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Undocumented Immigrants’ State & Local Tax Contributions (2015)

April 15, 2015 • By Matthew Gardner, Meg Wiehe

This report was updated February 2016 Read as a PDF. (Includes Full Appendix of State-by-State Data) Report Landing Page In the public debates over federal immigration reform, sufficient and accurate information about the tax contributions of undocumented immigrants is often lacking. The reality is the 11.4 million undocumented immigrants living in the United States pay billions […]

Reuters: Why Are States Leaving Billions in Retiree Income on the Table?

April 13, 2015

Illinois exempts all retirement income from state taxes – Social Security, private and public pensions, and annuities. We’re leaving $2 billion on the table annually, according to the state’s estimates. And we’re hardly alone: 36 states that have an income tax allow some exemption for private or public pension benefits, and 32 exempt all Social […]

Illinois Times: Angry Crowd Protests Rauner’s Budget

March 25, 2015

Herzenberg pointed out that Illinois was ranked fifth on the Institute on Taxation and Economic Policy’s (ITEP) ‘Terrible Ten’ list of states with the most regressive tax systems. He said Illinois’ tax system is regressive because high-income earners spend a smaller percentage of their income on sales and consumption taxes than low-income and middle-income earners, […]

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State Tax Preferences for Elderly Taxpayers

March 23, 2015 • By Meg Wiehe

State governments provide a wide array of tax breaks for their elderly residents. Almost every state that levies an income tax now allows some form of income tax exemption or credit for citizens over age 65 that is unavailable to non-elderly taxpayers. And most states provide special property tax breaks to the elderly. Unfortunately, too many of these breaks are poorly-targeted, unsustainable, and unfair. This policy brief surveys federal and state approaches to reducing taxes for older adults and suggests options for designing less costly and better targeted tax breaks for elderly taxpayers.

Progress Illinois: Tax Fairness Key to Solving Illinois Budget Crisit

March 16, 2015

Illinois has the fifth most regressive state tax system in the nation due to its flat income tax, under which all residents are taxed at the same rate despite their income, and its relatively high reliance on sales and property taxes, according to a separate report released earlier this year by the Institute on Taxation and Economic Policy (ITEP). The […]

Pekin Daily Times: Illinois Taxes Hit Vulnerable the Hardest

March 6, 2015

Illinois has the fifth most regressive tax system in the country, according to the Institute on Taxation and Economic Policy. That means low-income and middle-class people are hit the hardest. “The problem with our state tax systems is that we are asking far more of those who can afford the least,” said Meg Wiehe, a […]

Chicago Sun Times: More Education Cuts

March 4, 2015

Meanwhile, our system of taxes hits low-income families the hardest. The Institute on Taxation and Economic Policy named us one of the 10 “Most Regressive State Tax Systems,” with the third-highest “Taxes on the Poor.” Yet if just 20 large Illinois companies had paid state taxes at the required statutory rate over the past five […]

An updated version of this report has been published with data through July 1, 2017. Read the report in PDF form. Many states’ transportation budgets are in disarray, in part because they are trying to cover the rising cost of asphalt, machinery, and other construction materials with a gasoline tax rate that is rarely increased.1 […]

Progress Illinois: Illinois Ranks Poorly on Wellbeing Indicators

February 2, 2015

Additionally, researchers highlighted the fact that Illinois has the fifth most regressive tax system in the nation, according to a separate study recently issued by the Institute on Taxation and Economic Policy. The analysis showed that the poorest Illinois residents currently pay almost three times more in taxes as a percent of their income compared to the richest people in the […]

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Who Pays? (Fourth Edition)

January 30, 2015 • By Carl Davis, Matthew Gardner, Meg Wiehe

Major tax overhauls are on the agenda in a record number of states, and “Who Pays?” documents in state-by-state detail the precise distribution of state income taxes, sales and excise taxes and property taxes paid by each income group as of January 2013.  It is a critical baseline against which future proposals can be measured. […]

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 […]

Evanston Now: Illinois Tax System Among the Most Regressive

January 21, 2015

A new study from the Institute on Taxation and Economic Policy says Illinois residents face one of the most regressive state and local tax systems in the nation. The institute — which defines regressive taxation as a system in which lower income people pay a higher percentage of their income in taxes than those who […]

Public News Service: Illinois Poor Face Unfair Tax Burden

January 20, 2015

A new study finds Illinois’ poorest residents are paying almost three times more in taxes than the top one percent of earners. According to the Institute on Taxation and Economic Policy, the state takes a much greater share of income from middle and low income families than from the wealthy. Read more A new study […]