Gov. J.B. Pritzker Plans Reelection Year Tax Relief; Snow Cancels Legislative Session

As Gov. J.B. Pritzker heads into a reelection year that could prove trying, on Wednesday he is set to present a budget proposal with nearly $1 billion in one-time tax relief.

Pritzker had been set to lay out his vision in a public address before a joint session of the state legislature. But around 8 p.m. Monday, members of the House got notice that the session scheduled for Tuesday through Thursday would be canceled due to the heavy snow forecast for central Illinois.

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Citing the omicron surge of the coronavirus, legislature leaders had previously canceled all but one day of the session that had been set to meet regularly throughout January.

Still, Pritzker’s office is outlining his plans this week for a temporary tax relief program.

The COVID-19 pandemic has caused a lot of pain, but governors across the country have benefitted from billions of dollars in federal relief to their states. For its part, Illinois has received $7.5 billion in direct aid.

According to a document from the governor’s budget office about his family relief plan, come the new fiscal year that begins in July, Pritzker proposes temporarily knocking out a 1% sales tax on food at a projected savings to taxpayers of about $360 million.

“Savings to taxpayers” doesn’t come free – it’s money that Illinois governments wouldn’t be taking in.

In addition to the temporary food tax cut, the governor’s office is also planning to temporarily freeze the scheduled increase to the gas tax tied to the Consumer Price Index.

“It’s about groceries, gasoline and property taxes,” said Andy Manar, deputy governor for budget and the economy. “Those three things combined are what the governor is proposing to the legislature that we have a robust discussion about. And that’s tackling the impact that inflation is having on working families across the state.”

Manar said that temporarily suspending that hike could save drivers about two to three cents a gallon on gas.

“The governor understands that inflation is real and that it’s eating into the pocketbooks of working families in the state. So when the bill was enacted several years ago, I don’t think too many people ever dreamed that we would be facing the situation that we’re facing today,” Manar said.

A situation, he said, in which the state’s budget is on track. When the federal government passed its own infrastructure law, money was also earmarked to the states for road work.

Pritkzer also plans to outline an effort to give homeowners a one-time property tax rebate at a max of $300. The governor’s budget office projects that would save eligible homeowners (thereby dinging the state for a year) nearly $500 million.

Property tax reform has long plagued Illinois. There have been task forces, commissions, research papers and a legislature committee devoted to it, but it has not been tackled in a fulsome fashion.

“There’s nothing wrong with taking a good, hard look at property taxes,” Manar said. “But the governor believes this is the more immediate way to bring tax relief to homeowners across the state. (The tax rebate) is something that can be implemented relatively quickly, we believe. We also think that it impacts as many people, as we can seek to impact in the coming fiscal year.”

Manar said by devoting more state money toward education, which is the predominant driver of property taxes, Pritzker has done his part to lower homeowners’ property tax burdens.

The governor’s office is likely to promote the one-time nature of the expenses as a positive; given that they won’t be costly drains on the state budget in future years.

But the one-time favor to taxpayers will also give Pritzker the ability to highlight his tax relief efforts on the campaign trail, as he faces a reelection battle.

Follow Amanda Vinicky on Twitter: @AmandaVinicky

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