Flash index shows rising tax receipts in Illinois

By Jim Talamonti | The Center Square
The Center Square

(The Center Square) – Illinois income tax and sales tax receipts are up for the fiscal year that ended on June 30.

The Illinois Flash Economic Index based on major Illinois tax revenues rose from 101.1 in May to 101.4 for June, with numbers more than 100 reflecting growth.

Fred Giertz, emeritus professor of economics at the University of Illinois Urbana-Champaign, said the increase comes during a long-term period of gradual decline.

“Now, decline doesn’t mean the economy is getting worse. It means that the economy is not going ahead as fast as it otherwise would. So where we are right now is a period of modest growth, but slower than we have been the last several years,” Giertz told The Center Square.

Giertz said Illinois has a low unemployment rate by historic standards, but it’s still above the national average.

“Illinois, as most people know, even though we’re growing here, we’re not growing as fast as the rest of the country,” Giertz said.

Major components of the flash index for June 2026 showed year-over-year increases.

Giertz said individual income tax revenues have been strong all year, possibly driven by large capital gains.

“That increases the revenue, so the fact that the stock markets have been strong in the last year or so probably had an impact there,” Giertz said.

Giertz said higher sales tax receipts reflect real growth over and above higher prices.

“Every month, the tax revenues are, the term is called deflated, that is, the inflation is basically taken out of them. So all the numbers are based on real values, the same purchasing power over a period of time,” Giertz said.

Giertz said corporate tax revenues are lower than last year but still very good by historic standards.

Giertz said the flash index was devised almost 30 years ago in the University of Illinois Institute of Government and Public Affairs, because federal and state government data doesn’t come out for weeks or months after a given month ends.

“We decided to use the tax revenue as kind of a surrogate or a substitute or a quick measure of how the economy is doing, so that’s been the substance of the Flash Index for several decades now,” Giertz said.

Giertz said the index is very good for quickness, but adjustments have to be made to deal with unusual situations regarding tax revenues, such as changes in cash flow patterns.