Inside:
- Tax receipts down in January
- Educating drivers about Scott’s Law
- Illinois ranked #49 in the country for business taxes
- Out and about in the 71st District
Tax receipts down in January
The latest monthly briefing from the Commission on Government Forecasting and Accountability shows that payment of revenue to the state of Illinois dropped significantly in January. Compared to the year before, personal income taxes paid to Illinois were down by $52 million. Corporate incomes taxes fell by $15 million, adding up to a total shortfall of $67 million in revenue.
Sales tax receipts went up by $16 million over the same time period, but the decline in income tax revenue was steep enough to produce an overall negative number for the state in January. Putting together all the state’s general fund tax lines, receipts were down a total of $22 million in January 2024 as compared with January 2023. Up until now, revenues into the state’s coffers have been just barely enough to keep up with the increases in spending authorized by the Democrats’ Fiscal Year 2024 state budget. But this latest decline marks what could be a significant turnaround.
It’s another reminder of why we need realistic estimates of revenue when we make our budget, why we need to be responsible when deciding how to spend taxpayer money, and why we need transparency in our budget process.
Governor Pritzker will present his State of the State and Budget Address on Wednesday February 21.
Educating drivers about Scott’s Law
When you see an emergency vehicle – whether it is a police car or fire truck, a tow truck or a personal vehicle with flashers – on the side of the road with its emergency lights activated, Illinois law requires you to slow down and to merge over if possible. We have this requirement in order to protect first responders who work in the very dangerous environment on the side of Illinois highways. The law has become known as “Scott’s Law” after a Chicago firefighter who was killed when he was struck by a car while at an accident scene.
Scott’s Law has been in effect for several years now, and the state continues to try to educate motorists about its requirements. But every year we see more first responders struck, injured and sometimes even killed by careless drivers who fail to slow down or move over when passing an accident scene.
To try to help with these educational efforts, one of the bills I have introduced this spring, House Bill 4711, would put greater emphasis on the Scott’s Law question on the Illinois driver’s license examination. If a person is unable to correctly answer the question of what to do when approaching a stationary emergency vehicle, that person will automatically fail the written portion of the exam – but they will be able to retake the written exam that same day if missing this question is the cause of their failure.
We need to do everything we can to make drivers aware of how to avoid these kinds of tragedies. Putting greater emphasis on the importance of this question on the driver’s exam and bringing awareness is a great way to do so.
Illinois ranked #49 in the country for business taxes
Above I told you about the decline in corporate income tax revenue for the state of Illinois last month. It is noteworthy that tax revenue would decline even though Illinois has the second-highest corporate tax rate of any state in the nation. Illinois has a 9.5% consolidated tax rate on businesses – that is, a 7.0% standard corporate income tax plus a 2.5% personal property replacement tax. Only Minnesota hits businesses with a higher income tax rate, at 9.8%. The rankings were compiled by the Washington D.C.-based Tax Foundation.
Illinois’ high taxes have long held our state back when it comes to attracting big job creators. Many states levy an income tax on businesses, but most of them do so at a much lower rate. For example, North Carolina levies a business income tax of only 2.5%. Illinois-based businesses are also confronted with some of the highest property taxes in the nation. Illinois has been trading places with New Jersey on the question of which state has the highest property tax burden.
Illinois finds itself at a disadvantage when competing with neighboring states to attract large job creators because of the lower tax rates on the other side of the border. Iowa’s top business tax rate is 7.1%, while Indiana is at 4.9% and Missouri at 4.0%. Furthermore, all of our neighbors reduced their personal income tax rates, corporate income tax rates, or both, between 2021 and 2023.
We are going to continue to lag behind our neighbors and much of the rest of the country if we do not prioritize business-friendly tax reform.
Out and about in the 71st District
I had a great time at the Tri-County Cattlemen’s Association annual banquet over the weekend. What a great honor to receive the Beef Backer Award. The association consists of Henderson, McDonough and Warren Counties.
Amanda Radke was the keynote speaker and spoke of how everyone needs to speak out and be an advocate for cattle producers. She speaks all over the country and writes educational books for children.
Saturday morning I started out at The Old Dairy, having breakfast with B Btry/2-123 FA veterans. Then I went to the Hotcakes for Heroes event at WIU. This event raised money to send a WIU veteran student to the Ohio Valley Conference championship basketball game.
Thank you to LTC (Ret.) David Thompson for sponsoring the breakfast. I also enjoyed watching the game on ESPNU, which was the first national broadcast basketball game from WIU.
Thank you to Tammy for representing me at the ribbon cutting for the new addition to the Sherrard Elementary School in Sherrard. A lot of thank yous were given for a job well done. What a beautiful gym, two new classrooms, two new conference rooms and restrooms.
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