There is one state constitutional amendment on the ballot in Illinois for November 3, 2020. The constitutional amendment would repeal the requirement that the state’s personal income tax is a flat rate across income. Instead, the amendment would allow for legislation to enact a graduated income tax. Contributions to the campaigns surrounding the amendment have topped $80 million.
Gov. J.B. Pritzker (D) advocated for a graduated income tax structure for Illinois during his 2018 gubernatorial campaign. One of his former staffers, Quentin Fulks, is chairing the campaign Vote Yes for Fairness to support the amendment. Through September 18, the campaign Vote Yes For Fairness, along with allied committees, had received $58.97 million. Gov. Pritzker provided the campaign with $56.5 million, or 96 percent of supporters’ total funds. Other top donors include the AARP ($664,680), Omidyar Network ($500,000), National Education Association ($350,000), and American Federation of Teachers ($250,000).
Opponents of the constitutional amendment have organized four PACs, and two of them have received funds through September 18—the Coalition to Stop the Proposed Tax Hike and the Say No to More Taxes. Between the PACs, opponents had received $21.65 million. Kenneth Griffin, CEO of the investment firm Citadel, contributed $20.00 million to the Coalition to Stop the Proposed Tax Hike. The Illinois Opportunity Project, a 501(c)(4) nonprofit organization, donated $550,000. Other top donors—who each gave $100,000—include Richard Uihlein, the Samuel Zell Revocable Trust, and MacNeil Automotive Products.
While the constitutional amendment itself would not adopt a graduated income tax, the Illinois State Legislature passed legislation to go into effect if voters approve the amendment. The legislation would change the state’s income tax from a flat rate to six graduated rates beginning on January 1, 2021. Currently, income is taxed at a flat rate of 4.95% in Illinois. Under the bill, the proposed tax rates would range from 4.75% to 7.99%.
At the election on November 3, the constitutional amendment needs to receive either (a) 60 percent of votes cast on the ballot measure itself or (b) a simple majority of all of those voting in the election. Since 1996, voters have approved 83 percent of the constitutional amendments put on the ballot by the legislature. The last amendment that was rejected would have required a three-fifths approval by the General Assembly, city councils, and school districts to increase the pension benefits of their employees.
The Illinois constitutional amendment is one of three income tax-related ballot measures in 2020. In Arizona, Proposition 208 would enact a 3.50% income tax, in addition to the existing income tax (4.50% in 2020), on income above $250,000 (single filing) or $500,000 (joint filing). Proposition 208 would distribute the revenue from the 3.50% income tax to teacher and classroom support staff salaries, retention programs, and career and technical education programs. In Colorado, Proposition 116 would decrease the state’s flat income tax rate from 4.63% to 4.55%.