Tax & Budget Debate Continues - With less than ten days remaining in the spring legislative session, the House and Senate appear to remain far apart on passage of a state budget. As the IMA reported last week, the House of Representatives passed a $38 billion budget late last week that presumed revenue from making the temporary income tax hike permanent. Following passage, the House used a parliamentary procedure to keep the bills in the chamber pending discussions on the tax extension.
Gubernatorial Candidates Headline 2014 Business Day - Governor Patrick Quinn and Republican Bruce Rauner who are squaring off in the November election treated manufacturers attending the IMA’s annual Business Day to a riveting luncheon program featuring spirited remarks. More than three hundred manufacturing leaders and members of the Illinois Retail Merchants Association traveled to the State Capitol to meet with lawmakers to discuss key issues of the day including tax policy, minimum wage, and government regulations.
Progressive Tax Fails to Advance, Permanent Tax Hike on Table - With the clock counting down, Senator Pro Tempore Don Harmon (D-Oak Park) pulled the plug and did not call SJRCA 40 for a vote this week that would have created a graduated income tax in Illinois. State law requires proposed constitutional amendments to pass the General Assembly six months prior to the election meaning lawmakers needed to act by May 5 in order to meet the deadline. With the General Assembly failing to act this week, Illinois voters will not face a graduated income tax in the November election.
Senate Moves Forward on Graduated Income Tax
Less than a week after Speaker Michael J. Madigan introduced and moved forward with a new graduated tax on “millionaires” the Senate responded with their own graduated income tax proposal. Sponsored by President Pro Tempore Senator Don Harmon (D-Oak Park), SJRCA 40 as amended provides that “there may be a fair tax where lower rates apply to lower income levels and higher rates apply to higher income levels.” The IMA strongly opposes the imposition of a graduated tax that violates the basic tenets (broad-based and low rates) of a good tax system and penalizes successful job creators.
Governor Quinn Unveils Budget Blueprint - Six weeks after it was originally scheduled, Governor Pat Quinn addressed a joint session of the General Assembly to provide his blueprint for a new FY15 state budget totaling $38.6 billion. The new budget, if approved by the General Assembly, would represent an increase of nearly $1.8 billion in spending over the FY14 expenditures that totaled $36.6 billion. Funding for the new state budget is premised on Governor Quinn’s public desire to make the “temporary” income tax hike permanent.
Illinois Energy Deregulation Saved $37 Billion: Illinois electricity consumers – resident, business and government – have saved $37 billion since 1998 as a result of deregulation according to a new comprehensive report released this week by the Illinois Manufacturers’ Association in concert with the Illinois Retail Merchants Association, State Chamber of Commerce, and the Illinois Business Roundtable. Since the law took effect, Illinois’ electric rates dropped from the 13th highest average price in the nation to among the ten lowest.
IMA Testifies at House Tax Reform Hearing - Representatives of the Illinois Manufacturers’ Association testified again before a joint committee hearing featuring members of the House Revenue & Finance Committee and State Government Administration Committee. This week’s hearing primarily featured representatives of the business community who outlined strength and weaknesses of Illinois’ current tax system and its impact on employers.
House Tax Reform Hearings Continue - This week, the House State Government Administration Committee and Revenue & Finance Committee held their second public hearing to discuss Illinois tax policy and tax incentives. As the IMA reported previously, this week’s hearing exclusively featured testimony from the Department of Revenue, Department of Commerce & Economic Opportunity, Office of the Comptroller and the Commission on Government Forecasting and Accountability (COGFA).
Governor Quinn Provides State of the State Address - Standing before a joint session of the General Assembly this week, Governor Pat Quinn provided the annual State of the State Address noting that he’s strived to rebuild Illinois “one step at a time” in the five years following the impeachment of former Governor Rod Blagojevich. Before launching new ideas, the Governor noted that his administration has been “getting the job done” while touting passage of Workers’ Compensation and Medicaid reform, gay marriage, the capital infrastructure program, and most recently the pension reform package that is estimated to save $145 billion over the next thirty years.
Joint Committee Begins Tax Hearings - Last week, members of the House Revenue & Finance Committee and State Government Administration Committee launched the first of four public hearings to debate state tax policy. Seventeen witnesses presented testimony at the first hearing in Chicago including the Illinois Manufacturers’ Association that noted tax policy matters when companies are making decisions about where to invest capital and create jobs.