Illinois Gov. Jay Robert Pritzker attends a science initiative event at the University of Chicago, July 23, 2020. REUTERS/Kamil Krzaczynski
  • JB Pritzker, the billionaire governor of Illinois, supported a measure that would more heavily tax the rich — it failed to pass on election night.

  • Illinois currently has a flat tax rate, meaning every resident pays the same percentage of their income.

  • Pritzker wanted to raise the rate to be more progressive, gradually increasing for those making above $250,000.

  • The proposal had some deep-pocketed opposition, including fellow billionaire Ken Griffin.

  • Visit Business Insider’s homepage for more stories.

Illinois Gov. Jay Robert “JB” Pritzker — who is worth $3.4 billion, per Forbes — saw his graduated income tax proposal defeated on election night.

Pritzker wanted to do away with Illinois’ current flat tax rate, where everyone, regardless of their income, pays 4.95% in state income tax. Currently, 32 states and the District of Columbia have more “progressive” models, where wealthier residents pay a greater percentage.

The new model would have kept the flat rate for those making under $250,000, and would increase from there. The highest possible rate would have been 7.99%.

“Had the Fair Tax passed, we would’ve been on a course toward long-term stabilization of our state’s finances — balancing the budget, eliminating the backlog, making our pension payments & investing in a rainy day fund — in a way that would start to unburden our working families,” Pritzker wrote in a Facebook post.

Per CBS Chicago, Pritzker said the defeat of amendment could mean a raise in the flat tax rate, and the state will have to make cuts of between 15% to 20%.

“That’s approximately 15% fewer state troopers, that’s 15% fewer students going to college, 15% fewer working parents receiving childcare assistance,” Pritzker said in a press conference.

When reached for comment, Pritzker’s office directed Business Insider to his November 4 press conference.

Deep-pocketed opposition

One prominent opponent of the measure was billionaire Ken Griffin, who is worth $15 billion, per Forbes, the founder and CEO of Chicago-based investment firm Citadel. Business Insider’s Taylor Nicole Rogers previously reported that Griffin had given $20 million to an organization that advocated against the proposal. 

Another Chicago-based billionaire, Sam Zell of Equity Group Investments, also chipped in to opposition efforts, giving $100,000 through a real-estate trust.

According to CNBC, Pritzker himself donated more than $56 million to a campaign that supported the plan. The Pritzker family, which has 11 billionaires total, per Forbes, has wealth stemming from the Hyatt Hotel chain.

A big defeat

As CBS Chicago reports, this is the first “major defeat” of Pritzker’s time as governor, who was elected in 2018, part of a wave of Democratic gubernatorial flips.

“The opponents of the Fair Tax lied about what would happen if it passed, and they left all of the working people of Illinois holding the bag,” Pritzker said in a press conference. 

He said that Illinois now sits at a “crossroads.”

“Let me just say to the people of Illinois: you deserved a fairer tax system, and you still do. But that didn’t happen.”

Read the original article on Business Insider



Source link