Chicago, The Taxman Cometh

“Amid comparisons to ‘shuffling the deck chairs’ on the Titanic, the City Council’s Finance Committee agreed Monday to add another $1.1 billion to the mountain of debt piled on Chicago taxpayers…”

Chicago Sun-Times website, June 15, 2015

While Chicagoans celebrate the Stanley Cup, City Hall is mulling over which taxes of theirs to hike. Derrick Blakley reported on the CBS 2 (Chicago) website before the weekend:

With a huge budget deficit ahead, Chicago city government is desperately searching for new income.

Now, Mayor Rahm Emanuel may be seriously considering an income tax

Emanuel isn’t specifically talking income tax yet. But one of his strongest city council allies, 49th Ward Ald. Joe Moore, is speaking up.

“In my ideal scenario, it would be a graduated income tax that would be pegged at peoples’ ability to pay,” he says.
Some of the biggest U.S. cities already tax wages, including New York, Philadelphia, Detroit, Cleveland, San Francisco and Denver.

The tax that would also strike suburbanites who work in the city, Moore says.

The concept drew support Thursday from other mayoral allies who want to avoid a property tax hike…

Last year, the mayor rejected a city income tax. Not Thursday…

(Editor’s note: Bold added for emphasis)

The Chicago Sun-Times Editorial Board also picked up on Mayor Emanuel’s silence on the city income tax issue, writing Friday on the paper’s web site:

In a major break from the past, Mayor Rahm Emanuel did not immediately shoot it down…

(Editor’s note: Bold added for emphasis)

The Board added:

Might a Chicago income tax have bad, unintended consequences? Of course. And we’re by no means endorsing the idea here. But so might all the other taxes Chicago needs to consider: a commuter tax, a modest financial transaction, the broadening of the sale tax to cover more services, closing some tax-increment financing districts, congestion pricing and a pay-as-you-go garbage fee, to name some of the biggies.

Each revenue-generator should be vetted and priced out publicly, and the results should be explained far and wide so that the City Council and every Chicagoan come to accept two realities. One is the sheer size of Chicago’s financial crisis. The second is that no single solution will cut it. The pain has to be spread as widely as possible. The question then becomes: Which ingredients, in what proportions, make for the best stew — or at least the one that goes down easiest?

We have long said that raising property taxes — the city’s most stable revenue source, and one of the few it controls directly — is inevitable. But if property taxes are raised too much, both for Chicago and the school system, the city we know and love will cease to exist. An already dwindling middle class will flee.

A property tax hike should only be part of that bigger stew…

(Editor’s note: Bold added for emphasis)

Testing the waters? Conditioning Chicagoans for inevitable tax hikes?

All I know is this. Higher fees/fines/taxes. Reduced government benefits/services. That’s what I see coming down the pipeline for not only Chicago but the rest of the nation in due time.

Prepare accordingly.

Christopher E. Hill
Survival And Prosperity (www.survivalandprosperity.com)

Sources:

Blakley, Derrick. “Chicago Eyes A City Income Tax On Residents, Suburbanites Who Work Here” CBS 2. 11 June 2015. (http://chicago.cbslocal.com/2015/06/11/chicago-eyes-a-city-income-tax-on-residents-suburbanites-who-work-here/). 16 June 2015.

Editorial Board. “Editorial: Mixing up a stew of Chicago revenue solutions.” Chicago Sun-Times. 12 June 2015. (http://chicago.suntimes.com/opinion/7/71/685251/editorial-16). 16 June 2015.

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Tuesday, June 16th, 2015 Debt Crisis, Fiscal Policy, Government, Taxes

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