Last month, ZeroHedge put out a story about Illinois residents wanting to leave the state. Specifically, it cited the motivations of those with the intention of leaving. Last year, 53 percent of Illinoisans had entertained the idea of moving out of the state. Now, in 2019, that number has increased to 61 percent, based on a new poll from NPR Illinois and the University of Illinois Springfield.
Many are wondering what’s the main motivating factor behind them leaving the state. Well, according to the poll, state taxes are the number one reason for them wanting to leave the state. The poll found that 27 percent of the respondents cited taxes for their desire to move. The next reason most people decided to move was state government and policies, at around 17 percent. In third place, was better weather, in which 15 percent cited this factor as a motive for moving.
This poll serves as a warning to Governor J.B. Pritzker, who wants to eliminate the Illinois Constitution’s flat income tax provision and create a progressive income tax system. According to the poll, “Respondents reporting a household income of more than $100,000 a year (68%) are nearly ten percentage points higher than other income groups to say they’ve considered moving out of the state, with those reporting a household income lower than $45,000 (58%) being least likely.” At a glance, those with more resources appear like the ones who are most likely to leave.
Tax reform attempts like the progressive income tax that Pritzker is pursuing represents another way for politicians to extract money from the private sector to finance big spending. As far as taxation is concerned, Illinois is by no means slacking on that front. The state recently passed 20 new tax and fee hikes, which included a gas tax that was doubled, all to support a large $40 billion state budget.
The tax hikes that Illinois’s political class is proposing aren’t just coming out of nowhere. When we look at public employee pensions they’re already eating up a large share of Illinois’ state budget — one-fourth of it to be exact. Illinois’ pensions have exploded by 501 percent since 2000, which has put tremendous upward pressure on property taxes and has also resulted in cuts to state services.
One thing to note is that Illinoisians aren’t just entertaining the idea of moving out of state. Some have already taken the initiative by moving out. During the past five years, Illinois has earned the unfortunate distinction of being one of only two states to lose population on a consecutive basis. In this time period, Illinois lost 157,000 residents.
People aren’t leaving Illinois on a whim; it’s largely because of public policy. Although Illinois got marijuana legalization right, the state still lags behind in certain aspects of economic freedom. Cato’s Freedom in the 50 States index has it in 46th place for local tax burden. Not only are taxes high at the local level, but there aren’t many jurisdictions locally that people can move to in order to reduce their tax burdens. The authors of this index gave Illinois policymakers a wise recommendation — “Reform the retirement systems of localities to reduce local taxes, which are sky-high.” By exercising some modicum of fiscal restraint with pensions, Illinois could likely stem the flow of people leaving the state.
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