This is a terrible idea by Illinois Democrats to tax unrealized “paper gains” of billionaires’ investment portfolios because one thing is for certain: when they run out of billionaires, they’ll be coming for the millionaires. Dylan Sharkey explains for the Illinois Policy Institute, writing:
Illinois House Democrats introduced a $1.5 billion transit funding plan with a wealth tax on hypothetical income that doesn’t exist anywhere in the world. Taxes on streaming services and ticketed events are also a part of the plan.
- A 4.95% tax on unrealized capital gains for individuals with more than $1 billion in assets.
- A 7% amusement tax on streaming services such as Netflix and Spotify.
Increasing the sales tax in Cook County on certain food items by 0.25 percentage points.- A $5 surcharge on tickets for large concerts and performances.
- Expanded speed camera enforcement in suburban areas to generate additional transit funding.
Illinois would be the first in the world to tax wealth based on unrealized capital gains. Billionaires can leave the state far more easily than others can. When they leave, Illinois loses out on their income, property and sales tax dollars. As the tax base shrinks, the state would need to make up for that lost revenue, and less wealthy Illinoisans will be the only ones left to tax.
There’s no stopping lawmakers from lowering the threshold at which it kicks in in the future. What starts with billionaires opens the door to taxing others next. Even Gov. J.B. Pritzker doesn’t support the proposal.
“As it is, it’s not going forward” Pritzker said referring to the bill.
The plan avoids service cuts and fare hikes at Chicago-area transit systems including the Chicago Transit Authority, Metra and Pace, which face a $200 million-plus shortfall starting in 2026. The tax hikes go beyond what’s needed to prevent service cuts.
Action Line: Whether a plan like this is even constitutional is up for debate. Stay tuned. Click here to subscribe to my free monthly Survive & Thrive letter.
P.S. If you’re looking to escape a state like Illinois to find a better America, begin your search with Your Survival Guy’s 2025 Super States.
Originally posted on Your Survival Guy.