Is ‘graduated income tax’ too complicated?

Written By By Phil Kadner Posted: 04/06/2014, 02:29am
Array Illinois House Speaker Michael Madigan | Al Podgorski~Chicago Sun-Times

People don’t like the idea of a graduated income tax in Illinois.

When I started asking people about the idea more than a year ago, I thought their negative reaction was simply a hangover from the criminal convictions of governors George Ryan and Rod Blagojevich.

Of course, the fact that billions of dollars in tax money disappeared that should have been used to fund state pensions may have bothered people as well.

It’s always disturbing when you check the old checking account, find that its been drained, and no one can tell you exactly where the money went.

So I could understand the “you can’t trust these politicians” attitude, if that’s what people were thinking.

Still, it seemed strange since the federal income tax system is graduated, meaning that people who make more money have to pay a larger percentage of their incomes in taxes than the rest of us.

Illinois is one of only nine states to have a flat tax system, which also would suggest that in most of the country people thought it was a pretty good idea to copy the federal plan.

There are experts on tax policy who claim that most people simply don’t understand what the words “graduated income tax” or “progressive income tax mean.”

“I’ve been telling politicians to simply say they want to tax people with higher incomes at a higher rate and people with lower incomes at a lower rate,” one policy expert told me.

I don’t know if that’s where House Speaker Michael Madigan got his idea for a new tax surcharge on millionaires, but that language certainly makes it clear that it would be a higher tax rate on people with higher incomes.

My poll wasn’t very scientific.

I simply asked people I ran into at family events, social gatherings and while on the job what they thought about the idea of a graduated income tax.

“No,” they always responded.

“Well, maybe you don’t understand . . . ” I would immediately replay.

“I understand,” they always said. “I don’t want it.”

I was persistent to the point of nagging, wondering what’s not to like about a tax system that strives to produce revenue based on the ability to pay.

“It doesn’t work,” people said time and again.

And then they explained that they don’t like the federal tax system.

The rich guys never pay their fair share because they have lawyers, tax accountants and tax shelters created by Congress to hide their money.

The poor people pay nothing.

Honest working stiffs end up paying for everything, people said.

“I would rather have everyone pay a federal flat tax, based on actual income, so at least we know everyone is paying something,” one man said.

That made me wonder how people would vote on the current federal income tax system if given a chance.

Of course, I’ve often wondered the same thing about the First Amendment. A lot of people don’t know what that is either.


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