Illinois' newly signed $46.5 billion budget, which includes $1.8 billion in election-year tax relief and put a $1 billion deposit into the state's rainy day fund, will go into effect in just under three months.
“The budget I’m signing into law today brings real improvements to the lives of working families and sets us up for a stronger fiscal future,” Illinois Gov. J.B. Pritzker said in a statement. “Investments in stronger schools, modernized airports and newly paved highways, hundreds of thousands of well-paying infrastructure jobs, and a better funded pension system… these are the kind of priorities we can invest in when our state is governed responsibly.”
The budget plan goes into effect on July 1, the start of the state’s fiscal year.
But what does it mean for you starting this summer?
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The plan includes a direct payment to Illinois residents making less than $200,000 per year or $400,000 per year for couples filing jointly. Each taxpayer would receive $50, plus $100 for each dependent child, capped at three.
The checks are just one taxpayer relief program included in the state’s budget. Lawmakers say that the state’s 1% sales tax on groceries will be suspended through the end of the new fiscal year, and a planned increase in the state’s fuel tax, which currently sits at 39 cents per gallon, will not take effect until at least the new year.
The state’s fuel tax, which was slated to increase in July due to inflation, will instead be frozen at 39 cents a gallon through Jan. 1, 2023, with a taxpayer savings of $70 million.
Property tax rebates of up to $300 per household will also be included in the budget, along with an expansion of the earned income tax credit in the state, according to Pritzker.
The spending plan also includes Democratic legislative leaders’ response to soaring prices with temporary tax breaks on gas, groceries and real estate levies, and incorporates a permanent expansion of a tax credit for low- and moderate-income taxpayers.
The budget additionally includes more than $200 million for new public safety initiatives that answer Republican criticism that Democrats were not doing enough to address rising crime.
Still, while Democrats have praised the budget, some Republicans have criticized it as having "temporary election-year gimmicks."
“This Pritzker-Democrat budget has record spending, insulting temporary election-year gimmicks, and pay raises for politicians - all while ComEd files to raise rates on hard-working families and businesses using Pritzker’s energy tax law," Illinois' GOP Chairman Don Tracy said in a statement. "What Pritzker’s budget doesn’t do is give permanent tax relief to overtaxed Illinoisans, fully replenish the unemployment trust fund, or construct a path to budget stability for when the federal bailout cash runs out soon."
Illinois lawmakers approved the budget earlier this month. The Illinois Senate passed the budget plan on a 34-19 vote, while the House gave its approval on a 72-42 vote.
The budget relies on a robust post-pandemic economy and health tax revenues to include $1.8 billion in mostly temporary tax cuts that track closely with Pritzker’s election year proposal last winter.
