Treasurer candidate Tom Demmer campaigns in Rock Island against claimed retirement income tax plan
Demmer introduced a Resolution to the Illinois House in March cementing Republican opposition to a rumored plan to tax retirement income that was never proposed.
ROCK ISLAND, Ill. — Republican candidate for Illinois State Treasurer Tom Demmer visited Rock Island on Monday, Aug. 10, staunchly campaigning against the idea of a retirement income tax.
The candidate and State Rep. for the 90th District visited the riverfront at Schweibert Park with Mayor Mike Thoms as part of a wider campaign against tax increases, and, in particular, the taxation of retirement income.
“The last thing we need in Illinois today is a tax increase, or to tax seniors who have many other reasons they’re leaving Illinois. We don’t need to give them one more reason to do that,” he said. “We’re standing up strong today to say on behalf of those 54% of Illinois voters, who in the 2020 election rejected J.B. Pritzker and Mike Frerichs’s 3.5 billion dollar tax increase.”
The referenced Illinois Fair Tax plan was a 2020 bill that proposed Illinois’s adoption of a graduated income tax system, that would have sought to increase taxes on corporations and on those making $250,000 or more to an average of 7.85%. Residents making less than $250,000 would continue to pay the current flax tax of 4.95% or lower, depending on their tax bracket.
The bill was struck down in the 2020 general election by a small majority of Illinois voters who opposed the bill.
Demmer’s resolution, which he introduced on March 24, 2022, almost two years after the failure of the bill, was co-sponsored by 40 other Republican state representatives. The resolution’s synopsis describes its intention as, “Affirms trust in the decision Illinoisans made when they rejected the path to taxing retirement income by prohibiting the ‘Fair Tax’ from becoming enacted in the 2020 election.”
The 2020 Fair Tax proposal did not contain a plan to tax retirement income in its language.
Currently, in Illinois, retirement income from 401(k)s, IRAs, and pensions is exempt from state income tax. Demmer’s opponent, current Treasurer Mike Frerichs has said that he would not support changing that.
“I oppose creating a retirement tax in Illinois, along with the General Assembly, and governor,” Frerichs said on October 6, 2020 statement. “I encourage others to join me to stand up for working families and retirees so they get a tax cut while we ask millionaires and billionaires to pay their fair share. The fact is opponents of the fair tax have actually released plans to tax retirement income and raise taxes on everyone.”
The retirement income talking point in Illinois, at least partially, dates back to an October 2020 meeting of the Des Plaines Chamber of Commerce that Frerichs visited.
At the meeting, Frerichs was reported to encourage the discussion of the idea of a retirement tax income for the wealthy, and was quoted as saying “One thing a progressive tax would do is make clear you can have graduated rates when you are taxing retirement income and I think that’s something that’s worth discussion.”
He later clarified his position, saying that the discussion was in the context of graduated income tax increases on the top 3% of earners, with the hypothetical retirement tax idea only affecting those drawing at least $500,000 a year in pension income, and not affecting the overwhelming majority of Illinois seniors.
In response to Rep. Demmer’s statements, Treasurer Frerichs has reasserted his stance against retirement income tax and says that anyone claiming that the plan has ever been on the table is lying.
Rep. Demmer has also created a poll on his campaign website calling for support against the idea of retirement income tax.
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