Breaking Down Taxes & Revenue in the New Budget
Governor JB Pritzker and Lt. Governor Juliana Stratton speak to the media at the Capitol Sunday.
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Democrats admitted the challenges in passing a budget was a challenge and clearly attempted to make President Donald Trump the “bad guy” in the state’s financial situation.
“This year has been hard across the entire Midwest, indeed, the entire country,” Pritzker said in his Capitol office Sunday. “The Trump slump is affecting every state, and the chaos and uncertainty of the Republicans’ proposed cuts to health care and education and jobs have made budgeting, well, harder than ever before.”
The Commission on Government Forecasting and Accountability (COGFA), though, the legislative arm making budget projections, predicted a $3.2 billion budget gap in November, months before Trump took office.
So how did Democrats close the gap?
Lawmakers said the budget contains around $400 million in cuts, mostly to operations in state agencies.
It also includes around $880 million in “new revenue,” a mix between one time sources and tax increases.
The largest one-time revenue sources are $228 million from an income tax amnesty program and $171 million from a diversion of motor fuel sales taxes from the road fund to the state’s general revenue fund, according to a document shared with The Illinoize from Governor JB Pritzker’s office.
State leaders expect to bring in around $330 million in “closing corporate loopholes,” which includes a “Global Intangible low-taxed income” or GILTI, a tax on foreign earnings by Illinois-based companies.
It also includes “sin” taxes like increasing taxes on vape products and smokeless tobacco products, like “Zyn.” It also increases the per-wager bet in online sports gaming. The sin taxes are expected to bring in around $90 million.
The change also adds short-term rentals to the Hotel Operators Occupation Tax and adds a 9-8-8 telecommunications surcharge.
Here’s the file from the Governor’s office.
