Goodness gracious, but this one is a shocker. The latest video, from David Cay Johnston
If you work for a number of big employers in Illinios, the state income taxes that come out of your paycheck don’t go to the state government. They are kept by the company. You heard me right: the companies get to keep your state income taxes.
Good grief. According to his Reuters column
, the law was enacted in May. Why would Illinois do this?
"They wanted to provide benefits to those companies so they wouldn't move their factories to another state or country. Those companies pay little or no state corporate income tax, which the state could wipe out to get them to stay. So how to get money to these companies without writing them a check? Ah, let them pocket their workers' state income taxes."
It's that race-to-the-bottom tax competition again.
"The Illinois deal shows how competition between the states, and with other countries, helps big corporations wring subsidies from state governments even as the states are being forced to fire teachers and other public workers."
If people don't speak up about this, it's going to spread like wildfire. As he puts it: you and I will be taxed to subsidise our employers.