socastcmsRssStartBy Cole Lauterbach | Illinois News NetworksocastcmsRssEnd
In a measure of how much property owners pay in taxes, Illinoisans pay more than all but just a couple states in New England.
In their annual <a href="https://taxfoundation.org/ranking-property-taxes-on-the-2019-state-business-tax-climate-index">business tax climate index</a>, the nonprofit Tax Foundation put’s Illinois at fifth in terms of how much businesses pay in property taxes.
Residential property taxes are even higher in proportion to other states, said Tax Foundation policy analyst Katherine Loughead.
“Illinois’ residential property taxes are the second-highest in the nation behind only New Jersey,” she said.
High property taxes create lower demand which results in lower property values because the amount a potential buyer is willing to pay.
In weighing one side of the Illinois border with the other, states like Indiana, Missouri, and Iowa all have much lower property tax rates, Loughead said, making them more attractive to business owners looking to expand.
Business owners in Illinois also pay a number of other taxes that only a couple other states charge.
“Illinois also imposes a number of property taxes that affect businesses specifically,” Loughead said. “The state is one of only a handful that levies both a corporate tax and a corporate franchise tax and that’s a form of property tax because it taxes the net worth of the company instead of income.”
In a nod to homeowners, Gov. Elect J.B. Pritzker has said he would push for a progressive income tax to lower high local taxes.
Property taxes are considered the most stable sources of income because they don’t fluctuate as income and sales taxes do. Progressive tax proponents say property taxes are <a href="https://itep.org/whopays/">regressive</a> because they aren’t stratified by income, often hitting low-earners for more of their paycheck than wealthier property owners.
In Illinois, the majority of property taxes goes to local public schools, creating inequities based on local wealth.