By Benjamin Yount Illinois Statehouse News
CHICAGO — Less than a year after increasing Illinois’ corporate income tax rate, lawmakers are taking on the state’s business tax code.
The first of four hearings brought lawmakers, business leaders and Gov. Pat Quinn’s administration together Tuesday in Chicago.
State Rep John Bradley, D-Marion, who is overseeing the hearings for the House, said Illinois has long been called “bad for business.”
Bradley and other lawmakers would not say if one of those solutions would be to lower the corporate income tax rate. In January, Illinois’ corporate tax rate jumped more than 45 percent, from 4.8 percent to 7 percent. Instead, Bradley said he supported a “revenue neutral” solution.
But, Brian Hamer, director of the state Department of Revenue, said lowering the corporate tax rate is not the answer, because Illinois’ tax code is complicated and cannot simply be compared on a state-by-state basis. He added that the impact of Illinois’ taxes vary greatly.
However, Mark Denzler, vice president of the Illinois Manufacturers Association, which represents thousands of manufacturing businesses and lobbies state government, said businesses in Illinois are suffering, in part, because of the government of Illinois.
“We’ve seen an income tax increase, a proposed gross receipts tax, an attempt this year to repeal every tax incentive,” Denzler said. “The Department of Revenue is three years behind in paying corporate tax refunds. We face an $80 billion liability in pensions, and about a $6 billion short-term operating deficit.”
Denzler said Illinois’ financial woes and instability have created a negative climate for business. He said he doubts that if the current problems continue, Illinois will ever make good on the promise to roll back the income tax increase in four years.
Lawmakers are expected to hear from business leaders Aug. 2 in Rockford. Hearings also are scheduled for Marion in southern Illinois and at the statehouse in Springfield later this year.