From Illinois Business Journal news services
SPRINGFIELD – A plan to close corporate tax loopholes in Illinois has passed out of the Senate Revenue Committee.
Supporter, state Sen. Toi Hutchinson, D-Chicago Heights, said the measure is one means of addressing a cost-cutting plan that so far stresses too much cutting of social services.
“The governor’s budget as it is proposed inflicts real pain on our most vulnerable while also increasing costs for middle-class families,” Hutchinson said. “If we are going to be questioning every dollar that the state spends on programs for seniors, people with disabilities and working families, we need to ensure we are also looking at the other side of the ledger in regards to corporate giveaways.”
The legislation proposes eliminating three major loopholes that allow corporations to avoid state income taxes, including:
· Eliminating a subsidy for Illinois companies with activities in other states, therefore encouraging businesses to invest in Illinois;
· Eliminating a loophole that currently allows Illinois businesses to avoid paying taxes on overseas production; and
· Repealing the non-combinational rule certain companies use to set-up complex tax avoidance structures to avoid paying state taxes.
Combined, the loopholes amount to more than $330 million in giveaways to corporations.
“While this proposal is by no means the only solution in solving our budget crisis, it does start a needed conversation on how everyone can be a part of the solution,” Hutchinson said.
The bill, Senate Bill 717, passed the Senate Revenue Committee Wednesday and heads to the Senate floor for further debate.