Executive Director
Tax Institute

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All Key Chamber Legislation

Upcoming Events
May 10:   
House deadline to move substantive Senate bills out of committee and Senate deadline to move substantive House bills out of committee.

May 24:  
House third reading deadline for Senate bills and Senate third reading deadline for House bills.

May 31:
Illinois General Assembly scheduled spring session adjournment date.
May 10, 2019
State and Local Tax  
This Week 

Illinois General Assembly
The House and the Senate returned to Springfield on May 7  and were scheduled to be in session through Friday May 10.  However, the House and Senate both cancelled the Friday session.

The House was scheduled to be in session next week Monday through Friday. However, the House cancelled the Monday session day and will not return to Springfield until Tuesday. The Senate is in session next week Tuesday through Friday.

SJRCA 0001 was assigned to the House Revenue committee on Tuesday.  Representative Martwick is the sponsor of the amendment in the House. We continue to oppose the constitutional amendment in the House.

SB 687 - the legislation that sets forth a schedule of income tax rates for the tax years beginning January 2021 if the constitutional amendment is enacted was assigned to the House Revenue committee on Tuesday.  The House sponsor is Representative Zalewski, the Chair of the House Revenue committee.  We continue to oppose SB 687 in the House.
SB 689  amends the Illinois Estate and Generation-Skipping Transfer Tax Act to repeal the Illinois estate tax and the Generation Skipping Transfer Tax effective January 1, 2021.  The bill was assigned to the House Revenue committee on Tuesday. Representative Zalewski is the House sponsor of SB 689.
Although we are supportive of efforts to repeal the Illinois Estate and Generation-Skipping Transfer Tax Act, we did not take a position on this legislation because it is a portion of a package of bills tied to the graduated income tax legislation.
SB 690 is a property tax freeze bill that would extend the Property Tax Extension Limitation law beginning with levy year 2022 to certain school districts and limit the increase in property taxes to amounts approved by voters by referendum. The bill was assigned to the House Revenue committee on Tuesday.  Representative Zalewski is the House sponsor of SB 690.
We did not take a position on this legislation because it was a portion of a package of bills tied to the graduated income tax legislation.

SB 1515 - (Manley) was amended in the House. The bill passed out of the House Revenue committee to the floor yesterday. The amendment replaces everything after the enacting clause and amends the Illinois Income Tax Act. As amended the bill provides that, for purposes of being liable for income tax, compensation is paid in this State if some of the individual's service is performed within this State, the individual's service performed within this State is nonincidental to the individual's service performed without this State, and the individual's service is performed within this State for more than 30 working days during the tax year. Defines terms. Contains provisions concerning the calculation of compensation paid in this State if the employer maintains a time and attendance system.  We support the bill as amended.

Senate Revenue committee
The Senate Revenue committee met on Wednesday Here is a link to the legislation considered by the committee.  Nothing of particular consequence was considered by the committee.  

I am sure the Senate Revenue committee will meet next week, but as of this morning the hearing has not been scheduled.

House Revenue committee
The House Revenue committee met on Thursday.  The committee considered a number of bills, including SB 1515 discussed above.    Here is a link to the legislation that was considered by the committee yesterday.

The only controversial legislation discussed by the committee yesterday was HB 391, a transportation funding bill sponsored by Representative Zalewski.  The bill is described below in the discussion of this week's tax-related amendments.  This bill was amended onto a shell bill on Wednesday and posted for committee consideration on Thursday morning.  Among other things, the bill would increase the Motor Fuel tax by 25 cents per gallon.  The bill passed out the committee on a partisan vote.  The sponsor characterized this bill as a starting point for discussions on a capital bill to pay for infrastructure upgrades.

Todd Maisch, Illinois Chamber CEO, testified on our behalf.  At this juncture, we are neutral on the bill with the understanding that there are a number of things in the bill that we can't support.  We are neutral with the caveat that we will participate in negotiations on a capital bill in hopes that compromise legislation will be adopted that we can support.

SB 1379 - (Davis) - the Cook County Assessor's legislation to seek information from "taxpayers" with "income producing properties" was posted for committee consideration, but was not called.  This legislation has been the subject hyperbolic and wildly inaccurate discussion in the Chicago Tribune over the past two days.

The legislation, as it passed the Senate, remains deeply flawed and is opposed by a large number business groups.  I've linked a copy of our position paper.

We have committed to continue discussions on SB 1379 to see if we can reach a compromise with the Assessor.  Along with Carol Portman of TFI and mutual members we are working on alternative language to provide to the Assessor.  I suspect that discussions with the sponsor of the bill and the Assessor's office will occur next week.

The Revenue committee also held a subject matter hearing next Thursday morning entitled "Federal/State Transportation Financing:  ONE Central Proposal."

The sales, amusement and other taxes subcommittee of the Revenue committee met on Wednesday afternoon to hold a subject matter hearing on sports wagering. 

The House Income Tax subcommittee of the Revenue committee also met next Thursday morning.  The only item posted for consideration is HR 146 (Halpin) which urges the U.S. Government to enact a federal system limiting and regulating the types of incentives that states can offer.

Tax-related amendments legislation this week
HB 3233 - Senate amendment 1 - and  HB 391-House amendment 1.

As amended these bills are  transportation funding legislation. As noted above, after debate, HB 391 was voted out of the House Revenue committee on Thursday on a partisan vote.

Among other things, the bill would raise the  the Motor Fuel Tax Law. Modifies the tax to be imposed on the privilege of operating motor vehicles upon the public highways and recreational-type watercraft upon the waters of this State beginning July 1, 2019 and thereafter. Provides fuel tax index factors. Makes changes concerning the use of motor fuel tax money by municipalities and counties. Amends the Counties Code. Makes changes concerning the County Motor Fuel Tax Law. Amends the Illinois Municipal Code. Provides that, in addition to any other tax that may be imposed, if a municipality adopts a responsible bid ordinance that is approved by the Department of Transportation, then the municipality may also impose a tax on motor fuel at a rate not to exceed $0.03 per gallon. Amends the Illinois Vehicle Code. Modifies specified fees and taxes under the Code, and provides for annual adjustment of specified fees and taxes by the Department of Revenue. Provides for the use and deposit of the proceeds from additional fees imposed. 

SB 7 - (Steans) - Creates the Cannabis Regulation and Tax Act. The legislation creates a Cannabis Cultivation Privilege Tax and a Cannabis Purchaser Excise Tax. Authorizes the imposition of a County Cannabis Retailer's Occupation Tax Act and a Municipal Cannabis Retailers' Occupation Tax. Provides for allocation of revenues. Repeals the Cannabis and Controlled Substances Tax Act. Eliminates the delayed repeal date of the Compassionate Use of Medical Cannabis Pilot Program Act. Amends various Acts to make conforming changes. Contains home rule preemptions.

HB 1260  - (Zalewski) amendments 1 and 2 - are two variations on sports wagering legislation.  These amendments were discussed at the subject matter hearing of the House Revenue committee on Wednesday discussed above.

The House Revenue committee will doubtless meet next week.  However, as of this morning, it has not scheduled any hearings for next week.

The May 10 edition of the Illinois Register
did not contain any new rulemakings by the Illinois Department of Revenue or the Illinois Department of Commerce and Economic Opportunity.

The Department of Revenue adopted one rulemaking dealing with the Board of Appeals.  This rulemaking reflects changes in procedures regarding the filing of applications for voluntary disclosure.  The rules are updated to provide that applications for voluntary disclosure must be filed with the Department's Problems Resolution Division (PRD), rather than with the Board of Appeals.  Various statutory citations within the rules have also been updated, along with changes that reflect the current organizational structure of the Department.  The name of the Part is being changed to emphasize that the voluntary disclosure program is no longer administered by the Board of Appeals. 
Court cases
No new court cases this week.

Tax Tribunal 
No new decisions were posted this week.

None of the new cases raise unique issues of interest.

The Illinois General Assembly's bipartisan Commission on Government Forecasting and Accountability issued its  April monthly briefing.  The briefing explains that state revenues were much higher than anticipated in April.  As you may have seen in the press, as a result of this the Governor has determined that there will be sufficient funds for the state make its full pension payment for FY 2020 and he will not go forward with his earlier proposal to reduce the amount of the pension payment by stretching out the time frame for achieving full pension funding.

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