State Representative Tom Demmer (R-Dixon) is supporting a modest tax relief proposal in the form of a tax credit for individuals who earn less than $75,000 a year to help offset the rising inflation on families that is currently at 6.2%.
The estimated $1.4 billion estimated cost could be paid for out of the $8 billion Covid-19 Relief Fund since the 6.2% inflation rate has been caused by the covid-19 restrictions on businesses and job losses.
The current proposal announced today recommends a tax credit applied in the 2022 tax filing of $200 for individuals making up to $75,000; $400 for couples filing jointly; and $200 for head of households making up to $112,500 annually.
This one-time tax credit could be established to kick in only when the rate of inflation hits a certain level, like 6 percent or 5 percent and then sunset automatically when it goes back down to a predetermined level like 2 or 3 percent.
The legislation being drafted could be heard as early as January 4th, when the General Assembly is scheduled to convene again. The program to help families with a tax credit could be in place in time for when the tax filing process begins.