Jan. 12, 2011 -
PRLog -- Andover, Massachusetts January 12th, 2011 – Is your state one of the dozens nationwide that is running a massive budget deficit on a yearly basis? The worst offenders and those in the most financial trouble include California, New York, and Illinois. So what is the solution that one of these states, Illinois, came up with? You guessed it, raising your taxes!
Illinois announced yesterday that they would increase their personal income tax and corporate tax rates as a way to reduce their current 13 billion dollar budget deficit. The tax increases will raise about 7 billion dollars in the coming fiscal year, which still leaves a rather large hole for the incoming democratic governor to fill. The likely outcome of this 6 billion dollar gap is a widespread reduction in state services, a reduction in state worker’s compensation, and an increase in fees associated with everything from licensing to car registrations.
The Illinois plan raises the personal income tax from 3% to 5% for the next four years and raises the corporate income tax rate from 4.8% to 7% for the next four years as well. Realistically, any “temporary”
tax increase that has been enacted in the US over the past century has ended up being permanent. So what does this mean for Illinois residents and potentially you? Well, Illinois residents are headed for a rough four years. Their income tax rate is increasing 66%, perhaps the largest ever percentage tax increase in American history. This will most likely lead to lower consumption which will hurt the thousands of businesses state wide that depend on consumer spending. The corporate tax rate, while still lower than many of its neighbors, will make it more likely that current Illinois businesses move out of state and those looking to move into the state to reconsider. All in all, this plan is necessary but without massive spending cuts to compliment it, it will only lead to pain for the average citizen and a much bleaker economic outlook for the state as a whole. Residents nationwide should be ready for similar measures in their states. For the upcoming fiscal year states nationwide face a collective 41 billion dollar budget gap, the largest in history. So, even if your state isn’t in debt to the tune of 13 billion, any budget deficit means spending cuts and or tax hikes are being planned. Prepare now so you will not feel the pinch when it happens.
Readers, tax hikes or spending cuts? Which would you prefer? Can you have one without the other?
Preferred Financial Services is a debt reduction firm certified by the CFC (Center for Financial Certifications)
and accredited by U.S.O.B.A. (United States Organizations for Bankruptcy Alternatives)
. Headquartered in Andover, Massachusetts, Preferred Financial Services has been a leader in the debt reduction industry since 2003. Preferred Financial Services has acquired some of the best experience in the industry over the past 7 years. In 2009 alone Preferred Financial Services reduced over $16.5 million worth of consumer debt for just $6.4 million, for a savings of about 60%- and over 2,900 accounts were settled on behalf of their clients.
For more information, please visit www.pfsdebtrelief.com or follow us on our blog at www.pfsdebtrelief.com/
blog/ .
Contact:
Stephan Tavernini
Marketing Coordinator
Certified IAPDA Debt Arbitrator
Preferred Financial Services
stavernini@pfs1.net
# # #
Preferred Financial Services is the leading voice in the debt settlement industry. PFS has worked with hundreds of creditors to help negotiate realistic goals for those drowning credit card debt.
