Today, the Small Business & Entrepreneurship Council (SBE Council) urged state lawmakers in Illinois to reject a package of proposed tax increases that would hurt entrepreneurs, small businesses and their employees, and the state's competitiveness and economy.
The Illinois proposal would increase the state's personal income and individual capital gains tax rates from 3% to 5.25% (a 75 percent increase), the corporate income and capital gains tax rates from 7.3% to 10.9% (a 49 percent increase), and the cigarette excise tax from $1.00 per pack to $1.98 (a 98 percent jump).
SBE Council chief economist Ray Keating said: "This is a surefire way to chase away capital, entrepreneurial activity and jobs. It's astoundingly misguided tax policy. For example, if this package is approved, Illinois would then have the highest corporate income and corporate capital gains taxes among the states."
Illinois ranked 28th on the most recent edition, released last month, of SBE Council's "Small Business Survival Index," which ranks the states and District of Columbia according to their respective public policy climates for entrepreneurship and business. Keating noted: "All other things being equal, if this package of tax increases were imposed, Illinois would sink from a middle-of-the-pack ranking of 28 on the Small Business Survival Index to at least 41st, or even a bit worse. That would be eleventh worst in the nation."
Keating concluded, "If lawmakers are trying to make Illinois more hostile to entrepreneurship, business, investment and jobs, then this is the route to go. If not, then this package must be soundly rejected, and instead, lawmakers need to get serious about prioritizing and reducing government spending."