Tax rhetoric contains contradictions

I got to hear a Republican take on the Illinois government budget process that took place this spring – a community coordinator for the Illinois Senate Republican caucus took his shots at the process while attending a conference in west suburban Cicero this past weekend.

This should not be a shock. The Democratic Party-influenced government we have in Illinois ignored their GOP colleagues this spring. Republicans had no say. So these moments of pot shots that try to separate themselves from anything that might go wrong financially are a campaign tactic.

“IT’S NOT OUR fault!”

But what caught my attention wasn’t the trash talk about using revenue from tobacco taxes to try to pay down some of that $13 billion deficit the state faces. Nor was it a distaste for approving anything resembling a loan to get money to pay bills now.

My attention went to the portion that opposes the “tax amnesty” that was approved by the Illinois Legislature this spring, and now lies in the hands of Gov. Pat Quinn – who is expected to sign the measure into law some time in the coming weeks.

Under the measure (if approved), people who owe back taxes to the Illinois Department of Revenue now have until Nov. 8 to pay up. The incentive to get them to do so is that the late fees/penalties/fines usually associated with not paying up promptly by April 15 of the year in which the taxes were due will be waived.

THE STATE IS willing to settle for the money it is owed, and will not worry about penalizing someone with that late fee. State officials who support this measure say they are hopeful that enough people will pay what they owe so as to raise about $250 million in money that the state was owed anyway.

Now in a moment of personal disclosure, I owe a little bit of back taxes to the state of Illinois, and am currently in the process of trying to pay it off. I don’t know if this measure – should it become law – would apply to me. If it did, it would be a savings.

Because the thing about those late fees is that it becomes very easy for the penalty itself to become a larger amount of money than the actual tax owed.

Which is what makes many people who owe money to the state (or the Internal Revenue Service, for that matter) uncapable of paying – particularly when the total owed gets into the tens of thousands of dollars (my debt is relatively puny, by comparison).

SO BEING WILLING to accept a lesser amount (as in the actual tax owed) might just be a practical gesture. It is better to get what was owed in the first place, than nothing at all. Considering how severe the state’s financial situation is these days, every dollar that can be raised is legitimate.

Naturally, the Republicans who were left out of the budgetary process do not want to see things this way. They’re viewing the late fees/penalties as money lost to the state – although I have to wonder how much of a loss it really is if the fees were preventing people from paying anything.

I got to hear the rhetoric about how hard-working people who pay their taxes are being cheated while people who didn’t pay are getting a break. Which makes me wonder if their real motivation is to try to make themselves feel some sort of moral superiority, rather than try to figure out ways to come up with money to support the state.

If it reads like I think that we ought to be more concerned about trying to find funds (particularly, in this case, money that the state is entitled to anyway and will now receive) than trying to penalize people, you’d be correct.

IT ALSO IS one of those gestures that probably should be offered every few years (it was last done in Illinois in 2003) to try to clear some of those tax debts from the state ledgers, even though no one is suggesting that “amnesty” become an annual event. It could easily be another decade or so before this gesture could be offered again. Which means that those people who want to collect late fees/penalties will have ample chances to do so in the near future.

One other aspect catches my attention. It was an Illinois Senate aide whom I heard trashing the idea while I was working as a reporter-type – covering a conference of the League of United Latin American Citizens.

Yet when the actual bill came up last week in the Illinois Senate, it got a vote of 53-1. The one was state Sen. William Brady, R-Bloomington, also known as the Republican gubernatorial nominee, which makes me think that vote was more about being able to posture politically to the segment of our society that wants to think of everything in some sort of “law and order” mentality.

Punish somebody, rather than figure out how to get the money, particularly at a time when the state needs it. That makes no sense to me.

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