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Friday, January 07, 2011

I here there is a tax deal down their in Springfield...

As mentioned by the Capitol Fax via a Sun-Times article:
Gov. Quinn struck a deal with the Legislature’s ruling Democrats Thursday to raise the state income tax by 75 percent and boost the tax on cigarettes by $1 a pack — while a push to abolish the death penalty scored a historic legislative victory.

The cornerstone of a dramatic day, the revenue agreement reached by Quinn, House Speaker Michael Madigan (D-Chicago) and Senate President John Cullerton (D-Chicago) would impose a temporary increase in the state tax on workers’ paychecks from 3 percent to 5 ¼-percent.

The money from that, the cigarette tax hike and a corresponding increase in the corporate income tax from 4.8 percent to 8.4 percent would erase the state’s expected $15 billion deficit.

It also would generate a $700 million-plus windfall for schools and fund annual $325 rebate checks to property owners beginning in 2011, two key concessions fought for by leading black lawmakers, including Rep. William Davis (D-Homewood).
...
The deal, which was first disclosed Thursday by the Chicago Sun-Times, would limit future growth of state government during the next three years by imposing a moratorium on new programs and a 1-percent cap on new spending in each of those years, Cullerton said.
We can count this as a success for Pat Quinn. In November 2010 he barely eked out a victory in his re-election bid against Republican state Sen. Bill Brady. One could say the state was more worried about Brady's right-wing tendencies than Gov. Quinn's advocacy of an income tax hike.


One thing I would wish I could find out more about is the possibility of taxing internet purchases as is being reported on such sites as Internet Retailer via a link from Instapundit:
Illinois would levy taxes on Internet purchases under a plan that won final General Assembly approval today with an 88-29-0 vote in the state House. The law would make Illinois the latest state to try to squeeze revenue from online retail purchases, though other states have faced court challenges and the threat of lawsuits after trying to collect taxes from web sales. And some online retailers have simply cut off affiliates in states that have passed similar laws.

The Illinois law still needs approval from Gov. Pat Quinn, a Democrat. Lawmakers have 30 days to send it to him, and he then has 60 days to act. The tax would start on July 1.

The tax is part of an amendment to Illinois House Bill 3659. The tax would subject certain online purchases to the state’s 6.25% use tax. Those taxes resemble sales taxes, but, technically, apply to the right to use products purchased from Internet and catalog merchants that don’t collect sales tax on behalf of that state.
Let me say this, this may not affect me all that much since I rarely use internet retailers. Besides the only time I purchased anything online was when I was at school in ATL. In a crunch I had to buy a phone charger once. Another time I had bought an external hard drive.

Anyway to Illinois bloggers have already sounded the alarm on this tax old friend John Ruberry at Marathon Pundit and Backyard Conservative who are affiliated with Amazon.com. They've already recieved e-mails regard this possible internet sales tax and that they may no longer be able to do business with Amazon because of this.

Ruberry wants to make clear that:
Again it's the affiliates, people like me who will be harmed, not so much Amazon. Let me spell it out: If someone clicks on an embedded Amazon link in one of my music video posts for let's say, Richard Thompson, they may decide to buy one of his CDs or an MP3. The purchaser, that is, you, don't pay anything extra. I make a very small commission.I win, as you do you for enriching your life with artistic brilliance. Of course you can just go to Amazon to buy those tunes--and I make nothing. If Governor Patrick Quinn signs the internet tax bill, it will only apply to those affiliates, for instance Marathon Pundit or Backyard Conservative, based in Illinois. But it doesn't change the things for internet shoppers, even if they live in Illinois, if they go to Amazon directly to assauge their Richard Thompson cravings.

It's the little guy getting hurt. Now I have personal evidence that Illinois is hostile to small businesses.
Easy for me to say, why raise taxes during a deep recession? Illinois is suffering from financial issues sure, but raising taxes isn't the only answer. Illinois needs to make some serious choices as far as what to spend the money on. More accurately what needs to be cut.

You know, while I'm not yet a subscriber to this newsletter I would like to have found this on the CapFax. Although I may have missed something, perhaps there was more in this compromise than I have read without well having to find this news on more niche websites from outside of the state. At least I would be certain that well it has happened for sure.

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