ILLINOIS NEWS NETWORK
Part of the “grand bargain” to end the state’s budget impasse being heard in the state Senate are some new taxes.
One such tax is called an opportunity tax.
State Senator and sponsor of the proposal Toi Hutchinson, D-Chicago Heights, read a synopsis in committee on Tuesday.
“The Business Opportunity Tax creates a tax on each qualified business for the privilege of doing business in the state,” she said.
Then, in a moment of self-reflection, she immediately added, “I probably wouldn’t have written it like that.”
The tax, based on payroll, would tax businesses ranging from $225 to $15,000, depending on the size of their payroll.
However, National Federation of Independent Business (NFIB) Illinois State Director Mark Grant said there’s a disconnect.
“It is incredible to think that we’re going to keep talking about ways to raise more revenue for a state that hasn’t figured out how to balance a budget yet,” he said.
NFIB represents small independent businesses throughout the state.
Meanwhile, Hutchinson said the new proposed income tax rates would be 4.99 percent up from 3.75 percent for individuals, and 7 percent up from 5.25 percent for corporations.
Hutchinson said there’s more. The new proposal “implements a 5 percent excise tax on services including storage, repair, maintenance, landscaping and laundry cleaning.”
Taxpayers Federation of Illinois President Carol Portman said Illinois’ tax code is already confusing, and this would make a complicated mess.
“We already have a very complicated sales tax structure, and this just creates layer upon layer of new taxes — and that’s just the wrong way to go,” she said.
The updated proposal also removes a new sugary drink tax, which was included in earlier proposals, along with the state’s franchise tax.
Other critics of increased taxes believe lawmakers should find cuts without taxes to balance the budget.
As part of the overall package out of the Senate to end the budget logjam, if one measure fails, they all fail.