In separate remote appearances at “Virtual Business Day” in Springfield – one participant sent me a link to their presentations – House Speaker Emanuel “Chris” Welch seemed more willing to oppose Pritzker’s plan than Senate President Don Harmon . But even Harmon suggested that he wasn’t entirely comfortable with it.
Speaking at the conference sponsored by the Illinois Manufacturers’ Association and the Illinois Retail Merchants Association, Welch said that the state and its economy are only gradually recovering from COVID-19: “It is far too early to talk about additional taxes on our businesses . We’re talking about creating an environment that creates jobs. “
This comment came in response to a question about replenishing the state unemployment trust fund, which is usually replenished through taxes on employers. When Welch was asked specifically about Pritzker’s suggestion, however, he made it clear that he was not on board yet.
“The governor’s speech in February was a proposal … the start of the budget process,” Welch said. “We still have a long way to go… we agree with some of the things he mentioned. We don’t do some. We disagree with some of them. “
Harmon, who, like Welch previously, was interviewed by Hannah Meisel, a reporter from NPR Illinois, with the interview shown to attendees today, was more reserved in his comments.
Corporations have concerns and need tax stability, but they also depend on government programs that need funding, Harmon said. “I would hope companies would like to come to the Capitol to explain all of the benefits of this (tax) expense.”
He continued, “If these success stories don’t exist, we should probably look at these issues to see if they’re worth changing.”
Springfield insiders say it is most likely to pass on Pritzker’s list to exclude Illinois from national tax law changes during the Trump administration that allowed accelerated write-offs, as well as changes in how international dividends are handled.
It is less likely to limit the discounters retailers receive for collecting sales taxes. More uncertain is another proposed change that would force companies that have suffered losses during the pandemic to claim them in the years to come, not now.
These four items are valued at between $ 73 million and $ 300 million per year.
IMA President Mark Denzler said the items on Pritzker’s list were not “gaps” but “incentives that were passed by the General Assembly for a reason: incentives to create jobs”.
Industry groups will continue to advance their arguments, as suggested by Harmon, but given that Illinois taxpayers rejected Pritzker’s proposed tiered income tax in November and the state is receiving $ 7.5 billion in additional COVID aid : “I don’t hear much enthusiasm for tax increases now,” said Denzler.
Welch said it is possible that some of that $ 7.5 billion could be used to support the unemployment fund. Harmon said he would like additional federal aid for this.
Both leaders said it was not time to revive the discussion about a tiered income tax, but left that option open in the future as the state grapples with a persistent structural budget deficit of around $ 3 billion a year mainly because of increasing pension liability.