In Illinois, a Giant Deficit Leads to Talk of a Giant Tax Increase By Monica Davey, The New York Times
“SPRINGFIELD, Ill. — With Illinois’s budget crisis reaching dizzying, desperate levels, lawmakers here over the weekend were seriously pondering something that would have been unimaginable even a few months ago: a 75 percent increase in the state’s income tax.”
“In a moment when states around the country are wrestling with withered revenues, Illinois faces a deficit of at least $13 billion; more than $6 billion in unpaid bills to social service agencies, schools and funeral homes; the most underfinanced state pension system; and growing signs of concern from bond investors.
“We are very close to things becoming unraveled,” said Richard F. Dye, the co-author of a study released last week by a University of Illinois institute titled “Titanic and Sinking: The Illinois Budget Disaster.” The report suggested that doing nothing is simply no longer an alternative.”
“As word of a possible deal filtered out, some in the business community were criticizing the size of the tax increases, saying they would make new companies less likely to come here and existing ones less likely to stay. Others were predicting that angry taxpayers might appear in droves in Springfield on Monday.”