Governor Calls for $450 Million Tax Hike on Illinois Businesses as Part of Budget Plan

Governor Quinn delivered his annual state budget address this Wednesday to state legislators and called for a $450 million tax hike on Illinois businesses by closing what the Governor claims to be corporate tax “loop-holes” to pay for the state’s $9 billion backlog of unpaid bills. The Governor proposes to repeal or eliminate the Non-Combination Rule, the Domestic Production Activity Credit, and the Foreign Dividend Deduction. Click on each to learn about why eliminating these provisions of Illinois’ Tax Code would be bad for the business community.

Other highlights of the Governor’s budget includes a roughly $300 million in K-12 education cuts in order to address the state’s ever expanding pension crisis. In order to make up for education cuts, the Governor proposed any new revenue from gambling to go towards education. Of the major areas for General Revenue increases, GRF contribution to the state’s pension payments remain the largest, totaling $6.1 billion for FY14 (a $929 million increase from FY13). The Governor’s budget shows that he is anticipating spending more in pension payments, than any other major area in General Revenue.

Despite the Governors failure to include a pension reform plan of his own that addresses the $100 billion pension crisis, he has recently placed his support behind SB1 (Cullerton). Also, Representative Elaine Nekritz’s HB 98 will be heard in House Personnel and Pensions Committee next Thursday and to learn more about their proposals, including HB 3411 that she jointly filed with House Republican Leader Tom Cross visit Reboot Illinois’ editorial on the topic by clickingHERE.