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* It’s a pretty small buy, most likely intended to just generate some interest, but big business groups are now up on Downstate TV with a new ad against the governor’s gross receipts tax.
A 30-second spot, sponsored by the Illinois Coalition for Jobs, Growth and Prosperity, is set to run on stations in Springfield, Champaign, Bloomington and Peoria. In it, three businessmen talk about how the proposed levy would harm their companies and their customers. […]
Greg Baise, president of the Illinois Manufacturers’ Assn., a coalition member, declined to say how much TV time the group has purchased but said it would be “enough to get the attention†of state legislators watching television during their evening hours in Springfield.
Mr. Baise said the spot, or others, eventually will air on cable TV and radio in Chicago. Given the cost, however, the ad is not likely to appear on Chicago broadcast television, where a series of pro-tax ads funded by unions and the Illinois Hospital Assn. have been running.
And here’s the ad. Rate it in comments below…
* Meanwhile, a day after calling the governor “Comrade,” the Belleville News-Democrat publishes an Op-Ed by the headmaster of somthing called Governor French Academy in Belleville that claims Blagojevich is a “French socialist mole.”
You may think that his name is Rod, but the governor’s recent tax hike proposal makes it quite clear that his name is actually “Pierre.”
So how did our great Midwestern prairie state get a Frenchman as its chief executive? The answer is simple — Pierre Blagojevich is a French socialist mole whom the perfidious French government sneaked into the U.S. years ago to change our American free economy into French socialism.
* Democratic Sen. AJ Wilhelmi is not all that excited about the GRT…
The tax could wipe out small business profits, be passed on to consumers, or force some businesses to leave Illinois, Wilhelmi said. He added that he has “grave concerns” because the 1.8 percent gross receipts tax is not transparent. It won’t appear on any receipts and will be built in to the cost of products.
* More budget stuff…
* Jones aims to derail Meeks tax swap plan
* Alternative tax bill looks stalled
* Governor calls business tax increase a moral issue
* Editorial: This just in, God favors higher taxes
* Editorial: Kudos to Flider for opposing Governor’s tax plan
* Chamber opposes Governor’s GRT
*** UPDATE *** Oops. I forgot to post this. From a press release…
Low-income, working families in Illinois are hit harder by the income tax than those in most other states. The income level at which Illinois families must begin paying taxes is among the lowest and worst in the country, according to the Center on Budget and Policy Priorities.
“Families earning less than the poverty level still must pay income taxes in Illinois, which means they struggle to provide for their children,†said Jerry Stermer, president of Voices for Illinois Children. “Illinois can do better by increasing the state Earned Income Tax Credit so that low-income families can keep more of what they earn and give their children a better future.â€
Illinois begins taxing a two parent, two children family of four when they earn just $15,600, nearly 25 percent below the federal poverty level of $20,615. A single-parent, two children family of three is taxed at $13,600, below the poverty level of $16,079, according to the report. Illinois is one of only 15 states that tax three-person families in poverty and one of 19 states that tax four-person families in poverty.
One way to strengthen working families is to increase the Illinois Earned Income Tax Credit (EITC). Nearly 765,000 low-income, working families benefited from the Illinois EITC last year. But because the Illinois EITC is set at only 5 percent of the federal EITC, the maximum amount a family can receive is about $220, the lowest in the nation.
The study can be found here [pdf file].
posted by Rich Miller
Tuesday, Mar 27, 07 @ 8:34 am
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Of course business will attempt to pass on this cost of doing business, just like they do with any other cost usually after adding much more than their actual increase in cost. What they are worried about is that their competition will offer the same service or product at a lower cost,forcing them to do likewise which could possibly result in a little less profit. Why shouldn’t business pay their fair share for the services that they use? Last year they were using the same “the sky is falling” rhetoric against the tax swap. Now they don’t like the GRT. They just don’t want to pony up. Eventually Gidwitz’ money will dry up and these stupid commercials will disappear. How long has Baise had his place at the trough, state and otherwise? Maybe businesses should drop their membership in the bloated IMA. That would save some cost of doing business.Oh yeah, they pass the cost of their dues on to their customers.
Comment by Bill Tuesday, Mar 27, 07 @ 8:49 am
OMG that is a terrible ad. Those people arent very sympathetic… My high school A/V club coulda produced a better commercial.
Comment by Mr Brown Tuesday, Mar 27, 07 @ 8:52 am
Wilhelmi says he is going back to the drawing board but then quickly says teachers and state employees are off limits. Teachers (pensions) and state employees account for a huge chunk of state cash–our cash.
Guess he doesn’t want to rile up the teachers and the state employees. I wonder how many state employees live in his district.
Comment by Cassandra Tuesday, Mar 27, 07 @ 9:15 am
Does Greg Baise, president of the Illinois Manufacturers support outsouring to commie states?
Comment by Anon Tuesday, Mar 27, 07 @ 9:34 am
Even worse is that dependent working children get taxed on every dollar earned if they exceed $2,000. That just isn’t fair.
Comment by Mr. Ethics Tuesday, Mar 27, 07 @ 9:45 am
I would have to say that the ones I scripted out are better than that.
http://htsblog.blogspot.com/2007/03/return-of-oneadman.html
Comment by OneManBlog Tuesday, Mar 27, 07 @ 10:29 am
“What they are worried about is that their competition will offer the same service or product at a lower cost,forcing them to do likewise which could possibly result in a little less profit.”
OK Mr. Smarty, imagine you can choose between two gas stations that are identical in every way. But one is priced 6 cents higher per gallon. You would go with the gas station with the lower price - and surprise! - everyone else will too.
Six cents - that seems so small. But that small difference will destroy a business.
What you see as a little difference isn’t. In a global economy it is that six cents that makes or breaks you. It isn’t a matter of a little less profit. It is a matter of losing ALL of your business because of it. That is the comptetition in the real world today.
GRT tax will ruin Illinois. Have a little respect for the people who hire, pay wages, and almost pay 50% of your social programs. If you had your way, they would pay for 55% and everyone would lose.
No way.
Comment by VanillaMan Tuesday, Mar 27, 07 @ 10:34 am
Also the ad is great. Any ad that uses the powerful quote like that AND IT IS PAT QUINN’S, is a good ad.
Comment by VanillaMan Tuesday, Mar 27, 07 @ 10:35 am
Calling Blagojevich a French Socialist Mole is insulting? To whom?
I just spoke to my mole and when I asked if they were offended by this stupid editorial, they said, “Oui!”
Comment by VanillaMan Tuesday, Mar 27, 07 @ 10:44 am
VM,
You just made my point. Would the more expensive station just go out of business or make adjustments in their other expenses or maybe settle for a little less profit? It is their choice. That still doesn’t mean that they shouldn’t pay for state services that they, just like individuals, consume.
The taxes don’t destroy the business the business owner does.
Comment by Bill Tuesday, Mar 27, 07 @ 10:51 am
It is stupid to tax people that make so little salary that they are required to ask the state for help in paying their bills.
Comment by i d Tuesday, Mar 27, 07 @ 10:55 am
I have respect for the people that pay wages, etc..That doesn’t mean I am willing to let them reap profit by shirking their responsibility to pay their fair share.
Other states have experienced no ill economic effects with the GRT.
It is time for businesses to live up to their social responsibility and pay for the services that they use and consume.
Comment by Bill Tuesday, Mar 27, 07 @ 10:58 am
Bill,
Explain how a car dealer that sells $20 million a year in product and is making less than $150,000 per year is supposed to afford the $300,000 tax?
I know of several car dealerships that you’ll be able to buy in small towns across Central and Southern Illinois.
I would assume that you’ll want to invest since you believe so much in the future of businees in Illinois.
Comment by Illinois Citizen Tuesday, Mar 27, 07 @ 11:20 am
BTW Bizman Jacobs is a dreamy alderman in Peoria up for reelection.
I think has to look cheap so the biz guys look poor…if it looked as slick as GOdRod he coul;d claim they were rolling in dough.
Comment by GettingJonesed Tuesday, Mar 27, 07 @ 11:21 am
Bill,
since all companies will be facing the same higher set of cost in the state, the only way anyone could offer lower prices is to cut into their profit margins, that makes no sense. Unless of course your talking about out of stat companies, which will happen in some case, then Illinois business will be an distinct disadvantage and if they have to cut in their profit margin that will make less attractive for investor and they will have less funds to invest in expand production and new jobs in the future. For the most part this tax would end up be paid for by the consumers throe higher prices. The GRT isn’t about making business pay for their share of state, its about adding a massive tax to fund new programs.
Comment by RMW Stanford Tuesday, Mar 27, 07 @ 11:36 am
Bill, I will give you a real example.
A small medical practice with 4 docs will likely gross more than $1,000,000 a year. They can’t raise prices since their prices are set by insurance companies.
So their options are. Reduce expenses, the biggest two expenses for most medical practices are salaries and insurance. Well you could pay the office staff or the nurses less, you could drop your malpractice insurance I suppose.
As for your materials (bandages, medications, etc) they will all be subject to the tax when supplied to you so that cost is likely going to be passed on as well.
An spare me the ‘medicade treatment will not be subject to the tax thing’ considering how long it takes the state to pay it’s bills, that doesn’t even cover the float between date of service and date of reimbursement.
I suppose to increase revenues they can try and see more patients every day but that would hurt care somewhat, but heck as long as the state gets it’s 6 billion who cares?
Bill have you ever worked in the private sector? Have you in the last 10 years?
OneMan
Comment by OneManBlog Tuesday, Mar 27, 07 @ 11:49 am
Yeah,
I work in the private sector now. My company makes less takes in less than 1 mil..As an s-corp I pretty much have it beat.
Comment by Bill Tuesday, Mar 27, 07 @ 12:24 pm
In Washington and Delaware they still sell cars and doctors still operate. Why didn’t the GRT ruin their states. Stop the “sky is falling” and agree to pay your fair share.
“the only way anyone could offer lower prices is to cut into their profit margins, that makes no sense.”
Yes it does make sense and that is what business will have to do if they want to compete and gain market share. Maybe a smaller bonus for the CEO might be in order.
Comment by Bill Tuesday, Mar 27, 07 @ 12:33 pm
It is blatantly obvious that the GRT is designed to tax the small businesses. Unfortunately, the general public is too ignorant to understand the obvious, so it works well to say you are going after the “fat catsâ€. If you want to exempt small business, please use the guidelines made by the State of Illinois to define a “small businessâ€. Such as wholesalers who make less than $10M are considered small business and can claim that when selling to the State of Illinois.
I did a quick example. Say a company’s revenue is $1M, net profit before taxes is 1% or $10K. With the 3% tax rate you owe Bozo $300, with Bozo’s GRT you would owe $5K. Over 1600 percent increase. If you wanted to offset the GRT you would either raise your revenues 95%, cut expenses or both. And you thought electric rate increase was a lot.
Bill, the next time you eat in your favorite burger shack and your burger costs you $8 instead of $4, I’m sure you won’t complain. Ooops, did I just suggest that the cost of living will go up? Besides, the larger companies that get $Billions of revenue from exporting their product out of state are exempt. I’m sorry, what is the definition of “fat cats”.
Draw line following where 51/39 crosses the Wisconsin border South to I-80 and then I-80 East to the Indiana border. Kick all the politicians that come from this NorthEast corner out of Springfield (as if they actually live in Springfield) and let them have the new State Chicagoland. In 5 years, let’s see who has a better economy.
Comment by Division Commander Tuesday, Mar 27, 07 @ 12:47 pm
OneMan,
In your Doctor example you left out the one actual alternative, the Drs could make LESS PROFIT!!!!
That is the whole point. They are not paying their fair share while reaping untold profit. Ive never met a poor doctor.
Comment by Bill Tuesday, Mar 27, 07 @ 12:51 pm
DC,
Spare us the regionalism. If you can’t argue the issue I suppose you have no choice but to play the geography card. Without the corner of the state you describe the Illinois economy would be you guys bartering soybeans for corn.
Comment by Bill Tuesday, Mar 27, 07 @ 1:00 pm
A lot of small business people’s “profits” are their incomes. Some of the items we purchase with that income are college costs, our own high cost of health care, our high deductibles in our health care policies, our self employment tax, etc. etc. Plus all the other taxes that we cannot or do not deduct as business expenses from our gross incomes. To think that we are not paying our fair share of our incomes in taxes is just nonsense.
There is some justification for some of the extreme language among those using the socialist tag. There are some people who do look upon any profits earned by the private sector as being evil. But most of these critics fail to realize that everyone is supported one way or another by the private sector. And there is no private sector without profit.
I cannot disagree that the distribution of incomes between the ultra rich and the poor and middle classes has become extremely skewed. And there would be some justification for eliminating the Bush tax cut and sharing that revenue with the states. Also, the state should consider raising more income tax from the upper sector as Pat Quinn has proposed.
I also cannot understand why we are not taxing all internet sales. This is unfair to all the local businesses who collect IL sales tax and who are competing with internet companies that are exempted from the IL sales tax. Very possibly, a GRT would have the effect of driving more consumers to shop on line, further reducing revenues derived from the IL sales tax.
The politicians are just not using their heads in trying to find sources of needed revenue.
Comment by vole Tuesday, Mar 27, 07 @ 1:12 pm
So as long as someone isn’t poor then the tax rate should be as high as possible? Is that what you are trying to say?
I don’t know a lot of GPs who are rich Bill? The average Family Doctor in Illinois makes about 140K. They are rich! They can afford it.
It seems your definition of ‘fair share’ is everyone pays but you.
If this stuff is so important, a moral imperative even then raise everyones taxes!
Until then it just strikes me as wealth redistribution.
Comment by OneManBlog Tuesday, Mar 27, 07 @ 2:00 pm
Bill, did I touch a nerve. You do realize that the State of Illinois’ number one manufacturing activity is food processing, right?
Forget my last paragraph Bill, counter my debate in the other 3. Also, please tell me how reducing the profit of a company will help to grow an economy. Companies work on profits. With those profits they expand their business in order to make more profits. Expanding a business means more jobs, build a new building, invest in technology, etc. Businesses do much more to support the economy than by just paying taxes to a government that wants to spend more money than they take in.
Bill, I guess since you can’t debate the issue you have to resort meaninless attempts at insulting. Remember, the reason you go the the burger shack is to buy your favorite food, which is the result of producing corn and soy beans.
Comment by Division Commander Tuesday, Mar 27, 07 @ 2:25 pm
OneManBlog - Ironically,just like every other business, the fastest growing expense for doctors is not their medical malpractice insurance. It’s health insurance for their employees.
Comment by Yellow Dog Democrat Tuesday, Mar 27, 07 @ 3:12 pm
Bill the Shill: Pray tell, what color is the sky in your world?
Should the people of Illinois just blindly trust a leader who bullies them and the legislature with his my-way-or-the-highway methodology?
No one person is correct all the time, yet in your posts it would appear that you praise Lord God Rod no matter what.
With so many people doing so much critical thinking about every aspect of Rod’s proposals (which I’m sure he thought of all by himself), how can you or anyone not even consider that they may not be the best thing possible for the state?
Comment by This Guy Tuesday, Mar 27, 07 @ 4:02 pm
Bill -
You inacurately descrive Washington and other states with the GRT.
Washington has the 3rd highest rate of business failure according to the US Small Business Administration. In research by the Washington Foundation, a bipartisan foundation, in the state of Washington, their research shows that their GRT is the primary reason. WA legislators have attempted to repeal it and its termed “draconian” but they have not identified a separate revenue source.
Indiana and Michigan repealed their GRTs.
And finally, I don’t believe that you work in the private sector. If you do, its certainly not in management. You would be on the hook for the GRT when the Corporate income tax phases out.
Comment by 4% Tuesday, Mar 27, 07 @ 4:10 pm
It would appear that the GRT is very unlikely to pass into reality, in fact it appears dead. With Emil unilaterally deciding not to allow the tax swap package to be called not option is gone. Looks like no tax increases this session. Okay, so what are they going to amputate? Time to start planning the surgery. So much for statesmen-like leadership. The dems appear in worse disarray than the gop. Heck, even the tops are spinning out of control.
Comment by A Citizen Tuesday, Mar 27, 07 @ 4:24 pm
YDD, cost growth is still different than net expenses. At least the growth rate of my wife’s malpractice has gone down.
Comment by OneManBlog Tuesday, Mar 27, 07 @ 4:40 pm
I don’t think the GRT is the best thing possible. I think the best thing possible is to increase the income tax to 4.5% on individuals and 9.5% on business,really close corporate loopholes,institute an alternative minimum tax on large corporations and extend the sales tax to services and internet sales without a swap. Property taxes can be addressed somewhat by passing the 7% solution for now.This would provide enough money for the state to meet its pension obligations,adequately fund education,and begin to address the health care crisis in Illinois.
This, of course, would never pass and I have to don’t run for re-election.
If you think I’m a shill that’s fine, but what does that make you and a lot of others on this blog that routinely trash anything and everything that the governor proposes.
Blagojevich has proposed and passed ground breaking legislation that is unprecedented among our cohort states. His proposal for health care is the most comprehensive ever proposed anywhere.These types of programs are why the Governor won re-election by a double digit margin over his nearest competitor.This is what the people elected him to do. His proposals, whether he thought of them himself or not, are better than any of the others I have heard. What is your solution? Who has been a more innovative, caring, compassionate, governor in your lifetime? Edgar?Thompson? Walker? Olgilve?Kerner?
So go ahead and continue making jokes about Lord God Rod etc..We don’t care! Finally, after all of these decades something will be done this session to address our state’s structural deficit.
This will be one of the Governor’s greatest accomplishments whether or not his original proposal passes.
Comment by Bill Tuesday, Mar 27, 07 @ 4:41 pm
4%,
You should probably pay attention to some numbers other than the amount of your last raise. As a tax eater yourself, even a republican one, you should be on the other side of this argument.
In fact, Washington has exceeded the national average for economic growth in each of the last 20 years. The fact that a few out of the mainstream legislators don’t like the tax really doesn’t mean anything.
Comment by Bill Tuesday, Mar 27, 07 @ 4:48 pm
Bill,
Your ‘impression’ that Washington State is doing ‘fine’ with the GRT is INACCURATE!
Boeing moved its corporate headquarters out of Washington state, in large part as a protest against, and to avoid the state’s gross revenue tax. Recently, Microsoft moved its incredibly lucrative licensing division out of Washington to Reno for the same reason. How well is the GRT working in Washington state Bill?
My husband is a physician and you can bet that he will follow the other four physicians in his practice and work in Indiana. Malpractice costs are four times less and he would not have to work for GROD!!!
Sure you like this tax, your business will not be affected. weak Bill, very weak.
Comment by missy Tuesday, Mar 27, 07 @ 4:53 pm
“Blagojevich has proposed and passed ground breaking legislation that is unprecedented among our cohort states. His proposal for health care is the most comprehensive ever proposed anywhere.These types of programs are why the Governor won re-election by a double digit margin over his nearest competitor.”
Yeah, less than 50% of the vote, heck of a mandate he got Bill.
Comment by OneManBlog Tuesday, Mar 27, 07 @ 4:58 pm
Oh yeah Bill if this is the kind of thing people elected him to do, why didn’t he share his plan about this before the election.
Oh yeah, he didn’t come up with a six billion tax increase (or fairness thing if you like Bill) until after the election.
Comment by OneManBlog Tuesday, Mar 27, 07 @ 4:59 pm
Oneman,
Did he not win by 9.8 % over his closest challenger? What % of the voters voted for no change by not voting?
It is a clear mandate to me and now he is coming through for us.
Comment by Bill Tuesday, Mar 27, 07 @ 5:01 pm
4% is correct, ‘Bill’ feeds off the government breast…
my solution .. cut spending, starting with the 70,000 a year chauffeurs ! remember pajamagate Bill!
Comment by missy Tuesday, Mar 27, 07 @ 5:03 pm
missy,
We can’t cut our way out of our structural deficit. Besides why would you want to put “4%” on unemployment?
Comment by Bill Tuesday, Mar 27, 07 @ 6:39 pm
Bill 9.8% is not ‘double digit’ (spare me the rounding) and no it’s not a mandate. Lisa, White those were mandates.
The fact the green guy did so well is proof of the fact he got the mandate.
Using your logic someone in each of the aldermatic races in Chicago that ended up in a runoff in some way got a mandate (they got more votes than the others, ergo mandate)
Finally, my basic question here is if the state needs another 6 billion to spend on schools.
Then again the governor did propose everyone’s favorite tax increase, the one that someone else has to pay.
Comment by OneManBlog Tuesday, Mar 27, 07 @ 6:54 pm
OneMan please,
Try to calm down. It is only money!
I think Obie is spiking the ice cream out your way!
Of course schools need more money. All of those damned educrats need a big raise and then get those obscene pensions. Big Ed is ruining this country. Fire them all and let the NRA run the schools!
Comment by Bill Tuesday, Mar 27, 07 @ 7:02 pm
Bill, ever ask an educator how much $$$ is enough? I’m definitely with you on the NRA suggestion. At least the high schools should have a marksmanship/shooting program - might take the mystique out of guns and save lives.
Comment by A Citizen Tuesday, Mar 27, 07 @ 7:34 pm