Mt. Vernon Register-News

State News

April 4, 2013

Business, advocacy groups split on Quinn tax plan


CHICAGO (AP) — Gov. Pat Quinn's proposal to end three so-called loopholes in corporate taxes got its first blast of public input Wednesday, as business groups questioned whether it's fair and could hurt job creation while child and citizen advocacy groups praised it as a way to help pay down Illinois' gargantuan backlog of unpaid bills.

The Illinois Senate Revenue Committee heard testimony Wednesday — the first of several planned hearings — on a plan Quinn first outlined in March to address the state's woeful financial situation. It includes taxing the foreign dividends of multinational corporations, and in total would generate an estimated $445 million a year toward paying down the roughly $9 billion backlog.

Human service providers said the slow payment of bills has seriously disrupted the work they do for the state. Kate Armstrong, chair of Through a Child's Eyes, a nonprofit that gives instruction and education support for at-risk pre-kindergarten students in suburban Chicago, told senators that the organization had to briefly shut down and lay off staff when the state did not promptly pay its bills.

"Nothing is worse than telling a group full of teachers who have been working hard to make a difference that they weren't going to get a pay check next Friday," Armstrong said.

But among the business groups opposing the plan were the Illinois Chamber of Commerce and Illinois Manufacturing Association.

During the hearing they questioned if parts of the plan were constitutional and said the changes would penalize businesses and hurt job creation at a time when Illinois already is battling criticism that it is not friendly to business. The chamber characterized the suspension of the tax incentives as a "tax increase."

"It sends a message loud and clear, manufacturing is not valued in Illinois," said Carol Portman, head of the Taxpayers Federation of Illinois.

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