The Illinois Policy Institute has a new study out titled “Illinois’ high-tax problem,” claiming the state’s tax system is damaging our economic competitiveness, especially with other Midwestern states. Writes the Institute:
While data for 2011 state and local tax burdens are not yet available, one thing is clear: Illinois isn’t just a high-tax state; it is an even higher-tax state than it was before. Illinois had the ninth-highest tax burden in the country in fiscal year 2010 at $4,512 per capita, higher than all its bordering states.
Here’s how Illinois ranks nationwide in several categories:
- State and local sales tax rates: 8.22 percent (10th)
- Property taxes as a percentage of home value: 1.73 percent (6th)
- Gasoline tax: 39 cents (7th)
- Estate tax per death: $2,418 (13th)
- Single-day travel taxes: $40.31 (1st)
- Corporate income tax collections per capita: $210 (6th)
One reaction to this might be well, maybe Illinois is worth it. Maybe it’s worth paying a premium to live here, as opposed to Wisconsin or Kentucky or Iowa, because there are more opportunities to make money in Illinois. Oprah Winfrey grew up in Milwaukee, where her mother still lives, but she would not have become one of the world’s wealthiest women as the host of a show called AM Green Bay.
Thirty-two Fortune 500 companies have their headquarters in Illinois, Sears, Walgreens, Motorola and Archer Daniels Midland among them. All our neighboring states combined have 34.
Illinois’ per capita income is also higher than any bordering state’s and higher than any other Midwestern state except Minnesota.
The average home value is $221,432, the highest in the Midwest.
So yes, the taxes are higher in Illinois. But Illinoisans also earn more money on which to pay taxes.