Christine Radogno

Amended Illinois Tax Hike Plan To Hit Taxpayers, Businesses, And Employment?

Back on January 16 I published a post on Survival And Prosperity entitled “Illinois ‘Grand Bargain’ Legislation Includes 32 Percent Personal Income Tax Hike.” I started the piece with:

Illinois taxpayers may get hit with a significant income tax hike pretty soon…

Yesterday morning, I learned the potential “hit” could be a “combination of punches” directred at taxpayers, businesses, and employment.

From the Greg Hinz On Politics blog on the website of Crain’s Chicago Business:

There’s still no word on when lawmakers are going to vote on it, but an amended tax-hike plan has been introduced in the state capital.

It’s a doozy, with an even higher income tax, a limited service tax and a sort of minimum tax on business. But the soda pop levy is gone, as are a couple of those corporate loophole closings that business groups didn’t like…

The highlights:

The Individual income tax would go to 4.99 percent from the current 3.75 percent, and the corporate income tax to 7 percent from 5.25 percent. Combined, that would pull in about an additional $5 billion a year.

A new “business opportunity tax” ranging from a fee of $225 to $15,000 a year would be imposed, based on payroll. The intent is to make sure that all companies pay something, whether they are profitable or not. The state’s net on this is an estimated $750 million a year.

However, the research and development tax credit would be made permanent and the manufacturers purchase and graphics arts credits would be combined, as some businesses wanted.

A service tax—extension of the sales tax—would be imposed on certain items including repair and maintenance of personal property, use of amusement services including gyms, landscaping, laundry and dry-cleaning, and storage of personal goods such as cars and property. This would pull in a projected $400 million a year.

The telecom excise tax would be extended to cable and satellite services.

Both Radogno and Cullerton are said to have negotiated and support the above, pending action on the rest of the package…

Hinz does a good job summarizing the proposed expanded revenue grab. At this point, I want to go back to that bit about a new “business opportunity tax.” From the actual legislation for the so-called “Business Opportunity Tax Act”:

Section 1-10. Tax imposed.
(a) Beginning on July 1, 2017, a tax is hereby imposed upon each qualified business for the privilege of doing business in the State.
(b) The tax under subsection (a) shall be imposed in the following amounts:
(1) if the taxpayer’s total Illinois payroll for the taxable year is less than $100,000, then then annual tax is $225;
(2) if the taxpayer’s total Illinois payroll for the taxable year is $100,000 or more but less than $250,000, then the annual tax is $750;
(3) if the taxpayer’s total Illinois payroll for the taxable year is $250,000 or more but less than $500,000, then the annual tax is $3,750;
(4) if the taxpayer’s total Illinois payroll for the taxable year is $500,000 or more but less than $1,500,000, then the annual tax is $7,500; and
(5) if the taxpayer’s total Illinois payroll for the taxable year is $1,500,000 or more, then the annual tax is $15,000…

I can see a number of existing and prospective Illinois business owners having concerns with the proposed “Business Opportunity Tax Act.”

First, Illinois already has poor business reputation. For example, early last year Chief Executive magazine asked 513 CEOs to rank states they are familiar with on the friendliness of their tax and regulatory regime, workforce quality, and living environment. The “Land of Lincoln” came in as the 48th worst state in this annual survey, beaten only by New York and California in that order. The “Business Opportunity Tax Act” has the real potential of increasing the perception that Illinois is business-unfriendly.

Second, if my understanding of the legislation is correct, the larger the payroll an Illinois business has, the more taxes they will pay. Consider the following. If I’m an Illinois business owner with a payroll just shy of $250K who would like to bring on more staff, I may be dissuaded from doing so to avoid forking over an additional $3,000 to the state (unless I’m convinced the hiring would offset the $3K hit). And how might employee raises be impacted once payrolls start approaching a higher tax bracket? The proposed “Business Opportunity Tax Act” may not be too terrific for Illinois employment.

Third, readers of this blog may know that I am in the process of rolling out a research business focusing on specialized asset protection. It’s been my intention to launch in the Chicago area. Lately, however, I’ve been thninking of opening up shop in southeast Wisconsin (where my family has a residence) due to the direction Illinois looks to be heading with taxes and its treatment of the business community. The passage of the “Business Opportunity Tax Act” could be the straw that breaks the camel’s back. I wonder how many other prospective Illinois business owners might be in the same boat?

Stay tuned…

By Christopher E. Hill
Survival And Prosperity (www.survivalandprosperity.com)

Source:

Hinz, Greg. “New, wider tax plan rolls out in Springfield.” Greg Hinz On Politics. 24 Jan. 2017. (http://www.chicagobusiness.com/article/20170124/BLOGS02/170129931/springfield-lawmakers-roll-out-new-wider-tax-hike-plan). 26 Jan. 2017.

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Standard-Capacity Ammunition Magazine Ban Passes Out Of Illinois Senate Executive Committee

Gun “control” is on the move again in Illinois as legislation banning standard-capacity ammunition magazines has passed out of the Illinois Senate Executive Committee, setting up Senate Bill 1002 to be voted upon by the full chamber. Lauren Leone-Cross reported on Springfield’s The State Journal-Register website late yesterday:

The Democrat-controlled Senate Executive Committee passed the measure 12-3, with two Republicans, Minority Leader Christine Radogno of Lemont and Sen. Matt Murphy of Palatine, voting “yes.”

“I think this is a chance that this bill could save lives, and I think it’s worth taking that chance,” Murphy said.

Leone-Cross added later in the article:

Sponsoring Sen. Dan Kotowski, D-Park Ridge, said that while he doesn’t know when he’ll call SB 1002 for a vote in the full Senate or whether he has the votes, it “looks promising.”

Illinois residents who think their Republican state senator will oppose this legislation might be in for a rude shock, seeing that Senators Radogno- the Minority Leader no less- and Murphy have now aligned themselves with the gun “control” camp on this bill.

In the meantime, the National Rifle Association’s Institute for Legislative Action has sent out the following:

Illinois: Anti Self-Defense Amendment to be Considered in Senate as Early as Tomorrow

Contact your state Senator IMMEDIATELY and urge him or her to oppose Amendment 2 to Senate Bill 1002!

Today, in another attempt to further disarm the law-abiding residents in Illinois, an amendment offered by state Senator Dan Kotowski (D-28) to Senate Bill 1002, was heard by the Senate Executive Committee. Amendment 2 to SB1002 would limit the sale and transfer of all standard capacity magazines. Rather than addressing criminals engaging in gang violence, Chicago politicians want to limit the ability of law-abiding gun owners to defend themselves against those criminals.

In a state that is under court order to enact concealed carry reform laws for the self-defense of its residents, this restriction on standard capacity magazines is a step in the wrong direction. This legislation will only remove the ability of responsible gun owners to defend themselves and their loved ones.

It is critical that you contact your state Senator and urge him or her to resist this legislative attempt to disarm and punish law-abiding citizens. Contact your state Senator TODAY and respectfully urge him or her to uphold Illinoisans’ right to self-defense by opposing Amendment 2 to Senate Bill 1002.

Contact information for your state Senator can be found here.

By Christopher E. Hill, Editor
Survival And Prosperity (www.survivalandprosperity.com)

Source:

Leone-Cross, Lauren. “Illinois Senate panel endorses ammunition limit.” The State Journal-Register. 20 May 2013. (http://www.sj-r.com/breaking/x776192437/Senate-committee-to-vote-on-proposed-high-capacity-magazine-ban?zc_p=0). 21 May 2013.

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