Chrissy Eager changes 9-month-old Evelyn’s diaper 12 times a day, 84 times a week. The Skokie mom said it adds up quickly, with the family spending $100 a month on diapers and baby wipes.
But now she’s hoping for a little help through a measure in Springfield that would lower the state sales tax for diapers and wipes to what might be called the bottom rate.
Legislation introduced once again in the state Senate would reduce the tax on diapers and baby wipes from the standard 6.25 percent to 1 percent, the same as food and some medications.
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Eager understood the proposed change would not be a windfall — a little over a nickel saved on each dollar spent. But the 30-year-old law firm receptionist said she’s taking unpaid maternity leave and juggling family finances, temporarily relying on only the income of her spouse.
“Anything could help tremendously,” she said.
What makes the legislation politically difficult this year is that new Republican Gov. Bruce Rauner and lawmakers are looking for ways to balance the state’s sagging finances. The state’s temporary income tax hike went down a notch Jan. 1, and while scaling back the rate gave taxpayers relief, it also left a multibillion-dollar hole in the state’s already reeling treasury.
Rauner has made it clear he wants a major tax overhaul and warned that there will be plenty of financial pain to go around. That means attempts to give tax relief may face higher hurdles than in other years.
While the savings for Eager’s family amounts to a few dollars a month, the statewide tally adds up fast. State revenue officials estimate that dropping the diaper tax rate for babies would cost Illinois about $10 million a year with an additional $2 million loss for the baby wipes.
There are a lot of babies and toddlers up to age 2 in Illinois — about 476,000 in 2013 — and there are plenty of kids age 3 and older who use diapers, too, officials said.
Sponsoring Sen. Martin Sandoval said the revenue loss to the state “absolutely” is worth the trade-off for helping out families.
The Democratic senator said the tax break is important because the costs of diapers and baby wipes are a burden to single moms and working families in his Southwest Side district, where, he noted, birthrates among Latinos is high.
“We shouldn’t be balancing our budget on the backs of single moms and working families,” said Sandoval, who added that he hears about the costs of caring for children “week in and week out.”
On average, a typical family with a baby would spend about $70 to $80 on diapers a month, according to officials at the National Diaper Bank Network. Cost-consciousness in low-income families may lead some parents to resort to unsanitary means, said Alexandra Eidenberg, founder of Mom+Baby, a Chicago group focused on affordable child care.
“Unfortunately,” she said, “families who can’t afford (diapers) allow their children to wear them longer than they really should.”
She suggested that waiting more than two hours to change diapers — something families might do to try to save money — increases the likelihood of diaper rash or urinary tract infections. Other families try to cut costs with more extreme measures, such as substituting disposable diapers with towels or plastic bags, Eidenberg said.
Sandoval’s measure would bring Illinois more in line with seven other states, including Minnesota and New York, that either don’t tax diapers or set a lower rate to ease the out-of-pocket expenses, particularly for low-income families, according to the Denver-based National Conference of State Legislatures.
California lawmakers are considering legislation that would make diaper purchases tax-free, according to the group, but that state’s finances are in better shape than the Illinois treasury.
Sen. Toi Hutchinson, chairwoman of the Senate’s Revenue Committee, said the idea of taxing diapers at a lower rate stands a chance of passing if the entire tax code can get a face-lift this session.
“I support the policy behind it,” said Hutchinson, an Olympia Fields Democrat. “We have to look at the overall tax code and everything we tax. … Sales taxes are regressive. They hit people who make less money harder.”
Even so, handing out tax cuts may not be a top priority during this spring’s fight over the state’s finances. Adding tax breaks could make the state’s precarious financial status even weaker, said Carol Portman, president of the Taxpayers’ Federation of Illinois.
“We have a standing position that frowns upon new exemptions and deductions,” Portman said. “Good policy — good tax policy — has a broad base and low rate, especially when the state’s at a difficult fiscal situation. New exemptions and deductions add to that problem instead of going the other way.”