Daily Debunk: The art of the non sequitur

Fair Tax Amendment opponents can’t help polishing their clouded crystal balls

When anti-taxers can’t argue with facts and reality, they draw on their crystal balls to create nightmare scenarios of what could, perhaps, just maybe happen. (Shutterstock)

By Ted Cox

The Illinois Policy Institute left us a gift for our Daily Debunk columns on the Fair Tax Amendment earlier this week with an article titled “7 Misleading Progressive Tax Claims Public Unions Are Telling Illinois Members.”

That’s a week’s worth right there, and we’re going to get to them all, although maybe not on consecutive days.

But let’s jump right into the first one, because this shouldn’t take long, and we’ve all got a much-needed weekend to get to.

Misleading claim No. 1: 97 percent of taxpayers will get a tax cut or pay the same as they do now.

So far so good. That is exactly correct, although some of our more conservative friends, fiscally, would like us to point out that the Fair Tax Amendment and the initial tax brackets set by the General Assembly are separate but connected issues. Fair enough. The Fair Tax Amendment, on top of the ballot in the Nov. 3 general election already underway across much of the state, simply alters the state constitution to allow a graduated income tax. The 97 percent claim stems from the brackets legislators set in passing the progressive income tax and sending it on to voters for final approval.

Those brackets only raise the tax rate from the current 4.95 percent flat tax for those making more than $250,000, estimated to be 3 percent of the Illinois population. The rest of Illinois taxpayers, 97 percent of us, would see the tax rate remain the same (actually only those earning between $100,000 and $250,000) or drop by a small amount for those making up to $100,000.

The brackets were set intentionally and transparently in advance so that Illinois citizens would know exactly what they’re voting for. No doubt about it, it’s a selling point that 97 percent of taxpayers will see little impact from the tax change, just as it’s a selling point that the top tax rate was set at just under 8 percent for those making more than $1 million a year — less than the top tax rates in Iowa and Minnesota among Midwestern states.

So how does the IPI counter that?

Reality: The progressive tax will make it easier to raise taxes on everyone in the future.

Now, you might be wondering if we somehow shuffled the seven “misleading claims” and the “reality” they ignore. But no, that’s the IPI’s response to the clear fact that the initial tax brackets set under what Gov. Pritzker has called the Fair Tax would cut taxes or leave them the same for 97 percent of state taxpayers.

We take issue with the notion that this response is “reality,” however. Instead, we’d simply point out that it’s a non sequitur, comparing the reality of what’s in the present with the IPI’s fantasy of what could happen in the future, which really has nothing to do with the initial position. Again, this is the “nightmare scenario” ploy of using scare tactics speculating on what could, perhaps, just maybe happen that have nothing to do with the present.

Anti-taxers keep insisting that, if the General Assembly can peel off 3 percent of taxpayers to take a hit this time in instituting a graduated income tax, they could pick some other 3 percent or 10 percent or some other minority percentage next time. And to a certain extent that’s true. But that’s speculation on the future, nothing to do with reality, and it ignores that voters have the power to hold their legislators accountable.

All the state representatives who voted for the progressive income tax and its accompanying tax brackets by a supermajority last year and who are running for reelection are on the same ballot headed by the Fair Tax Amendment this year. So are many of the state senators who voted for it. The same goes for the legislators who voted against. If voters don’t like the position taken by their legislators, they can vote them out — and they only need a majority, not the supermajority the Fair Tax Amendment needs to pass.

It looks to us, however, as if most if not all of the legislators who voted on these matters last year — either way — are quite comfortable with the stances they took. We’ll see how things shake out from there in a month. It’s why we hold elections in our representative democracy.

But, in a final note, we’d like to point out that as written — and anti-taxers are compulsive about the actual language of these matters — the IPI’s “reality” statement here is false. The progressive tax does not “make it easier to raise taxes on everyone in the future,” because that’s actually the conditions that exist under the current regressive flat tax: taxes have to be raised on everyone or no one, which is exactly why the legislature has been resistant to any sort of tax increases in the past, and exactly why state finances have suffered as a consequence, as we’ve already pointed out in a Daily Debunk. Good luck to any politician who proposes raising tax rates across the board in a progressive income tax; that’s exactly the high hurdle set by the flat tax.

As economists have pointed out repeatedly, a graduated income tax is a tool that enables the state — or the federal government, which of course already uses tax brackets — to tax the economy where it’s growing, where it’s vital. And we’ll insist again, as we have in the past, that anyone fortunate enough to make more than $250,000 in this economy as it slowly recovers from the coronavirus collapse deserves to pay a little bit more in taxes than those struggling to keep their heads above water.

That’s not a punishment; it’s only fair.