(The Center Square) – The state’s Republican Party says Gov. J.B. Pritzker has muzzled Treasurer Michael Frerichs, who was set to make clear his opposition to taxing retirement income in reference to a progressive income tax.
Illinois doesn’t tax retirement income. A question on the ballot for the General Election asks voters to change the Illinois Constitution’s flat income tax to a progressive tax structure.
In June at a Des Plaines Chamber of Commerce event, Frerichs told the group that passing the progressive tax would allow the state to tax the retirement income of wealthier Illinoisans without hitting middle-class seniors on fixed incomes, the Daily Herald reported.
"One thing a progressive tax would do is make clear you can have graduated rates when you are taxing retirement income," he said according to the Daily Herald. "And, I think that's something that's worth discussion."
He later said in August that he doesn't support taxing retirement income.
“I was not pushing for that taxation,” Frerichs said. “What we talked about was the progressive tax and how that would only affect about three percent of taxpayers out there, taxpayers making more than a quarter of a million dollars a year. That’s something I support.”
The treasurer was scheduled to hold a news conference Tuesday, but it was canceled moments before it was set to begin.
“I oppose creating a retirement tax in Illinois, along with the General Assembly, and Governor,” Frerichs said in a statement after the news conference was canceled.
Illinois Republican Party Chairman Tim Schneider said Frerichs was muzzled by Pritzker, but provided no evidence that Pritzker was involved in the decision to cancel the event.
“Pritzker has a plan to tax retirement income in Illinois and needs the constitutional amendment to get it done,” Schneider said. “Pritzker can muzzle Frerichs all he wants, but the secret is already out. To protect retirement income from Pritzker’s tax plan, Illinois voters must vote no on the constitutional amendment.”
Vote Yes For Fairness, a group that supports the tax change, said it won’t tax retirement income.
“Opponents of the Fair Tax are simply trying to confuse Illinoisans,” Vote Yes For Fairness Chairman Quentin Fulks said. “These attacks are nothing more than political rhetoric from those who are desperate to ensure millionaires and billionaires avoid paying their share and the burden stays on middle and lower-income families.”
Pritzker’s office didn’t immediately respond to questions about the event. Frerichs’ office also didn’t immediately respond to questions about the event.
State Rep. Joe Sosnowski, R-Rockford, said changing the flat income tax to a tax that allows different rates for different incomes creates “maximum flexibility for taxes.”
“By changing this constitutional measure, it allows future legislatures and governors with a simple majority to change it at any time,” Sosnowski said. “So they may say ‘now we’re not going to do it,’ but next year they could say ‘well those who are wealthy in retirement,’ whatever their number ends up being, they can start to tax retirement then.
“I don’t think that’s outside of the realm of possibility and unfortunately they would not have to go back to the voters,” Sosnowski said. “They could just pass that through the legislature and put it on the books and it just opens the door for more and more income taxes.”