Thursday, October 21, 2010

Is Indiana Better Off Than Illinois?

Illinois GOP gubernatorial candidate Bill Brady set off a debate over whether Indiana or Tennessee are better run states than Illinois during a debate with the Democratic incumbent Gov. Pat Quinn. Brady said Indiana and Tennessee are states that have "turned the page" and "learned to live within their means." That prompted the Chicago Tribune's Eric Zorn to run some fast facts that might surprise you. Take a look:

State Individual Income Tax Rates: Illinois, 3%; Indiana, 3.4%, Tennessee, 6%

State General Sales and Use Tax Rates: Illinois, 6.25%, Indiana and Tennessee, 7%

State General Sales Tax Collections Per Capita --Illinois $619, Indiana, $901; Tennessee, $1,101

Combined State and Local Tax Burden -- Illinois 9.3%; Indiana, 9.4%, Tennessese 8.3%

Per capita income --Illinois, $46,693; Indiana $37,279; Tennessee, $38,090

State Corporate Income Tax (.pdf) -- Illinois 7.3% , Indiana 8.5%, Tennessee 6.5%

Percentage of people below the poverty level -- Illinois, 16.3% Indiana 17.1%; Tennessee, 20.7%

Percentage of people earning more than four times poverty level income -- Illinois 36%; Indiana 31.6%; Tennessee 28.4%
Zorn found that if Indiana's tax rates were in place in Illinois, the state would be collecting $5.6 billion a year more. Wow! It is true that Indiana is not facing a budget deficit like Illinois, at least if we're not counting the $2 billion the state of Indiana owes the federal government for unemployment claims. I would note Zorn's state sales tax figures disregard local tax rates in Illinois which push taxes to the 10% range in the Chicago area. Our local food and beverage taxes in Indianapolis, however, push tax rates up to 9%.


Cato said...

Places to get good pizza: Illinois - 5,000,000, Indiana - 4.

Places to get Italian beef: Illinois - 5,000,000, Indiana - 20.

Check out the property tax burdens in Illinois. A very uninspiring house will run you $400 mo. in property tax, and it goes up from there.

Most cities in Chicago require city stickers, anywhere from $50 to $100.

Illinois is no tax haven, but it's nowhere near as depressed as the Bible Belt.

guy77money said...

Very hard to compare Illinois when you factor in Chicago versus Indianapolis.There is no doubt at the state political level things are a huge mess in Illinois compared to Indiana, at least their is no one committing suicide in Indiana. Outside of Chicago and Indianapolis I would bet that Illinois is in better shape then Indiana. The poverty level stat is quite telling.

Concerned Taxpayer said...

Unfair comparison - Tennessee does NOT have an state income tax EXCEPT on income from interest or dividends.