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In Quincy…
Lots of anger here. At least half the crowd is opposed to the GRT. Kind of a raucus bunch. They even booed the minister. Ouch
I’ve heard that the NFIB is very well organized here, but the opponents have so far identified themselves as just concerned citizens.
I should note that most of the opponents have remained silent. Not everyone has booed.
OK. Now all the opponents are booing. It started when the guv claimed thousands of big businesses pay hardly any taxes.
Update I’m back at the hotel and am trying to catch up on a little reading. ArchPundit, a Democratic blogger, calls the GRT a “Terrible, Horrible, No Good, Very Bad tax.”
Larry’s attack is mostly based on the pyramiding effect. The GRT hits IL businesses along the production and supply chain from the very beginning all the way through to the final purchase, making costs rise exponentially with each movement down the line. Pyramiding is a valid argument, and I don’t disagree, but it’s a little overstated.
First, and foremost, competition being what it is, some companies in the supply chain won’t pass any of the GRT cost along or will only pass some of it on.
Others in the chain won’t even be subjected to the GRT. You gotta first hit that minimum gross revenue (which, in the end, will undoutedly be higher than $2 million) before you’ll be taxed. Not every producer, supplier, whatever in every chain will meet the threshold. The Farm Bureau estimates that only 1,000 IL farmers would be directly subjected to the GRT, for example.
On the other hand, many of the companies that make and distribute agribusiness “inputs” (seed, fertilizer, etc.) would likely be hit by the GRT, which could very well drive up costs for Illinois farmers.
Also, that gross revenue amount only applies to in-state sales. A company that sells $20 million a year total, but only does ten percent of its sales in Illinois would meet the $2 mil threshold, but they would only pay GRT on that $2 mil. A company that sold $10 mil a year, but only ten percent was in-state would not meet the minimum and would not be subjected to the GRT.
The pyramiding argument can also be made about the corporate income tax, because all of the various manufacturers, producers, etc. are subject to that throughout the chain of production to final sale. The problem in Illinois, as the guv keeps saying, is that not all the companies are paying everything they should because of various loopholes.
Under this current proposal, the corporate income tax is either phased out or eliminated right away (I can’t remember which right now) and businesses who pay the corporate income tax will get a credit for that tax on their GRT bill. Some will also get a little bit of property tax relief and many will get help with their health insurance premiums.
Some of the opponents of the GRT are pushing instead for an income tax hike. I, for one, already pay more corporate income tax than the Tribune Co. has in some years. A personal/corporate income tax hike hits both my company and my personal wallet, while Mother Tribune will continue to avoid corporate taxation. Not fair whatsoever.
Those same GRT opponents also want a new service tax. It’s indisputible that some of the GRT’s costs will be passed through to consumers, but a service tax means everyone will see higher prices. Guaranteed.
All that said, however, the single biggest problem with this GRT idea that I can see is that it’s not based on the ability to pay. And that is a huge, unspinnable obstacle.
But if we’re gonna debate, let’s get it all on the table.
posted by Rich Miller
Tuesday, Apr 3, 07 @ 6:00 pm
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Did Rod tell them they could “hit the road” there too?
That seems to be the mantra for the day, along with a very Bush(the first)-like “read my lips, I never have and will never raise your taxes”-type statement he makes.
This is an assertion by Rod that really needs to be truth-squadded.
Comment by Gregor Tuesday, Apr 3, 07 @ 6:15 pm
He didn’t bus in a bunch of DCEO employees to applaud?
Comment by NoGiftsPlease Tuesday, Apr 3, 07 @ 6:49 pm
Did Rod run and hide on the bus and leave his kid standing on the podium to cry?
Comment by Papa Legba Tuesday, Apr 3, 07 @ 7:25 pm
It is clear from the phone calls Rich is making that there are plentiful free drugs on the bus, thus the message describing booers are opponents rather than informed citizens.
I am standing outside the PJS printing plant waiting for Molly’s blow by blow with GodRodTax.
Then I must drive to Alton to make Day III.
BTW Illinois is still waiting for Sen. Jacobs to tell us if he is for the GodRodTax
Comment by GettingJonesed Tuesday, Apr 3, 07 @ 7:52 pm
- GettingJonesed - Tuesday, Apr 3, 07 @ 7:52 pm:
It is clear from the phone calls Rich is making that there are plentiful free drugs on the bus, thus the message describing booers are opponents rather than informed citizens.
————————————————–
This is the second post you’ve made commenting on drugs and booze. Is there an inside joke we don’t know about?
Comment by Fan of the Game Tuesday, Apr 3, 07 @ 8:06 pm
Rich,
How many in the crowd at Quincy? How many booed? It would be nice to get a report of your feel for the crowds at each town and their reception of the governor’s message.
Comment by Fan of the Game Tuesday, Apr 3, 07 @ 8:44 pm
You mention the service tax proposed by some GRT opponents, but there’s no discussion of how this is different from the service tax component of the GRT. Is it just the minimum taxable gross receipts number or is the rate different too?
Comment by Roadkill Tuesday, Apr 3, 07 @ 8:49 pm
If this is about making everyone pay their share, we don’t we close up the tax loop holes that corporations uses to get out of paying taxes first, before adding a new tax that will have negative economic consequences? I suspect that the split on what is paid by the consumer and what is paid by the business for a service tax and the GRT will be about the same. The only difference being the service tax will not have as much of a compounding affect.
Comment by RMW Stanford Tuesday, Apr 3, 07 @ 9:30 pm
I was in Quincy. What an event! I was actually skeptical of the plan, but after hearing the Govenror I have started to come around. I still would like to see the threshold higher, but its hard to be sympathetic to a business that has a GR over 2 million per year. I mean it exempts 85% of the businesses.
I asked a couple of the protesters why they were opposed and they said it would hurt their business. I asked them if they had seen the plan - NO. I asked them if their gross reciepts were over 2 million - NO. Then, what are you doing here???? All I got was a shrug.
It was a fun event. I loved it!
Comment by Rice Rat Tuesday, Apr 3, 07 @ 9:45 pm
Re: Crowd. I would say 150-200 pro-Rod people.
20 protesters… One real fat guy near the front that was vocal. Funny, because he had an insurance hat on and they are all expempted!
Comment by Mr Brown Tuesday, Apr 3, 07 @ 9:48 pm
Amazing that Tom Carper & Rod’s people would not let a large group hold “NO GRT” signs inside a PUBLIC building in Quincy , IL . The place was filled with Dem & Repub citzens alike BOOING Rod . The large group that Rod had in Support were Union folks from Hannibal , Mo
Amazing !
The Boo’s for the preacher started when he said the area’s ONLY Hospital would turn down service w/o Insurance, too bad the boo’s started with hospital Admins and board members .
Bill of Rights getting squashed by Blaggo !
Free speech and Free expression !
Check Pundit for the picture of the people moved outside b/c of “No GRT” signs.
Blaggo’s ISP security & a Local States Att almost put ISP in jail . We do have rights that the Gov must have missed when he admitted not to reading very much .
Comment by Quincy Resident Tuesday, Apr 3, 07 @ 9:56 pm
“Under this current proposal, the corporate income tax is either phased out or eliminated right away (I can’t remember which right now)”
It’s neither. Way down on page 82 of the bill, the corporate income tax goes away after 2011 only if a new tax is enacted to replace the revenues.
“Funny, because he had an insurance hat on and they are all expempted!”
No, they’re not. On page 9 of the bill, Section 202(a)(2)(V) exempts premiums subject to the privilege tax on insurance companies, but that doesn’t exclude their investment income (a huge portion of their total income), reinsurance premiums, annuities, fees for services, etc. And the new tax will cause Illinois insurance companies to be subject to higher retaliatory taxes in the other 49 states.
“I asked them if they had seen the plan - NO. ”
I’ve read the bill. Have you, Mr. Brown?
Comment by Anon Tuesday, Apr 3, 07 @ 10:11 pm
Local News just reported on an AP report that Blago is once again using state employees and contractors to try to sell the GRT. Employee’s and Contractors “were provided a script” and asked to recruit supporters….
Sounds familiar to the I-Save RX promotional efforts
Comment by Larry Mulholland Tuesday, Apr 3, 07 @ 10:13 pm
“Mr. Brown,” there were a lot more than 20 opponents there. It was about half and half.
“Quincy resident” I don’t believe that’s when the boos started. There were boos all the way through the preacher’s remarks. As for signs, I’ve seen plenty of political events that have banned them. It’s not right, of course, but it’s not unusual.
During the governor’s speech, someone behind me said, “When do we get our chance to speak?” which I thought was odd. It was a speech, not a debate. But they did speak, loudly, with boos. It added some much appreciated excitement to an otherwise endless bus trip.
Comment by Rich Miller Tuesday, Apr 3, 07 @ 10:14 pm
As usual, the devil is in the details. It is impossible to “debate” something as complex as taxation in this way. Hardly anyone is informed enough about all aspects of the issue to actually debate so all you get are various platitudes brandished about and prejudices displayed. What is “fair” to one person is not “fair” to another and no one likes to pay taxes. However, they are needed and we would be better off debating efficiency rather than esoteric concepts of fairness. Ultimately everything comes out of the same set of pockets one way or another so efficiency is critical, in some ways more so than who ostensibly pays the tax at whatever point it is collected.
Comment by Way Northsider Tuesday, Apr 3, 07 @ 10:26 pm
Also the “insurance hat ” guy in front doing VAST heckling was a local contractor . I think Rod’s Spin Doctors made the unfriendly OLC into an out right hostile spot.
Funny to watch them scurry like rats on a sinking ship asking all “is the OLC a taxing body” ……..
Like the Boston tea party , Forgotonia has spoken tonight !
Comment by Quincy ILL Tuesday, Apr 3, 07 @ 10:49 pm
Welcome to Downstate Rich ! We “cheer” real well !
:)
Comment by Dave & Company looked for you Tuesday, Apr 3, 07 @ 10:51 pm
I heard today from an agency friend that the AG had investigated the use of agency staff to promote both I-Save RX and AllKids. This was after the Auditor General visited and was interested in the same kind of information. This is an agency that has nothing to do with health care or kids.
This sounds like the use of agency / contract staff to promote the GRT.
Comment by In the Sticks Tuesday, Apr 3, 07 @ 11:19 pm
Sounds like someone we read and love is taking a tiny sip of the Koolaid. Why can’t the Governor, JUST ONCE, speak truthfully, off the cuff, and directly to the people, instead of being a belligerant (”hit the road”)bully, always spoiling for a fight. He and his kindergarten class staff are ridiculous
Comment by Disgusted Tuesday, Apr 3, 07 @ 11:21 pm
Rich -
On pyramiding, corporate income taxes are not pyramided. If someone else provides me with services, they will pay taxes on the money I give them. However, the money I give them is deducted from my net income — the part I pay taxes on — so I don’t pay a tax for their tax.
GRT works just the exact opposite. I pay them the money, but I still have to pay a gross receipts tax on the money I gave them, so in effect, the same money is taxed as income all the way down the chain. I pay a tax on it, then they pay a tax on it, then she pays a tax on it, and then he pays a tax on it, all the way down until it gets to the end of the chain — to either a raw producer or a worker — then it’s taxed one more time as either corporate income or personal income.
In short, Rod Blagojevich is turning me — and a lot of other Illinoisans — into Republicans. I’d love to see a poll that asks “If the Governor’s $8.5 billion tax plan becomes law, in the upcoming 2008 elections, will you be more likely to vote Democratic, more likely to vote Republican, or will it make no difference?”
Comment by Yellow Dog Democrat Wednesday, Apr 4, 07 @ 12:20 am
I think it is helpful not to forget what this tax is being proposed for - healthcare that will help those small businesses far more than they might, potentially, one-day, maybe lose out in taxes.
Comment by JohnR Wednesday, Apr 4, 07 @ 12:44 am
Foul JohnR. You have forgotten another of the guv’s taxes. If you are a small business that does not provide health insurance to your employees you have to be a 3% “health care tax”. This proposal is to to provide among other things insurance to illegals.
Comment by leigh Wednesday, Apr 4, 07 @ 6:18 am
I wonder how many of the opponents who did all the booing were paid by the Chamber to be there?
Comment by pyr man Wednesday, Apr 4, 07 @ 6:18 am
pyr man
Stop wondering. The answer is none of them.
Comment by Dave Wednesday, Apr 4, 07 @ 6:37 am
Please, YDD, I know you well enough to know you’re in no danger of EVER becoming a Republican. lol
Comment by Rich Miller Wednesday, Apr 4, 07 @ 6:39 am
Wow the Peoria coverage was just outstanding. You could tell Molly almost asked GodRodTax if he had talked with one legislator asking for a vote to roll back ratesa. Same for the insurance plan.
I am sure the evil editors suppressed the news and replaced it with the gee whiz stuff.
Great picture of the Dork with his hair out of place.
And to Fan of The Game…if don’t think the “docile Rich” coverage doesn’t suggest the presence of a lot of mind altering substances then the joke is on you. I am trying to get the facts out. The truth will set us free.
Comment by GettingJonesed Wednesday, Apr 4, 07 @ 6:40 am
We’re getting suckered with this debate. If the Democrats or some Democrats what a GRT then fine, let them propose the legislation with all the nitty gritties spelled out.
In the meantime, I’d rather talk spending and the mismanagement of it.
Comment by Bill Baar Wednesday, Apr 4, 07 @ 7:05 am
Sounds like they want to through out the baby with the bath water. If certain corporations are using loopholes not to pay taxes you should target those business and close the loopholes. Do not punish all business in Illinois. Many of Illinois business pay their fair share and should not be punished. No matter how this Governor tries to spin this they are not all bad. They pay this Governor’s salary.
Taxpayers of this state should demand more from public officals.
Comment by Anonymous Wednesday, Apr 4, 07 @ 7:24 am
Rich - has anyone mentioned the impact that the GRT may have on already red hot high electric rates. The fuel is hit, the electricity sale is hit and reflected in the auction price or contract, the delivery from the utility is hit, and all of those hits are relected in higher rates for consumers approved by the ICC.
Comment by bandman Wednesday, Apr 4, 07 @ 8:36 am
Insurance companies have a limited portfolio of investments. Generally they shoot for inflow premiums equals outflow claims. Investment income is used as a back-up.
Casualty insurance companies are a big part of the municipal revenue bond market. With the difference between long term corporate bonds and long term municipal bonds narrowing, a GRT on investment income will cause less demand for municipal bonds in that sector and drive up the cost of borrowing — indirectly, the cost to the taxpayer and rate payer.
Comment by Truthful James Wednesday, Apr 4, 07 @ 9:24 am
Yseterday 1124 responded to the SJ-R’s on-line question “Do you agree with the concept of a GRT on business?” The response, which is clearly non-scientific, was 14.4% yes; 85.6% no. One gets the impression that Springfieldians aren’t buying into the GRT.
Comment by Keyser Soze Wednesday, Apr 4, 07 @ 3:06 pm
I covered the Governor’s Quincy visit for local radio. There were about 250 people present, and the split was about half and half, with maybe a few more opponents than supporters.
It was a very vocal crowd, both for and against. The “insurance” fellow, whom the governor sort of engaged by referring to him often (saying he wished he could make the fellow “happy”), kept responding with “no new taxes”.
However, the totality of the opponents–most of whom I know and many of whom were NOT business people–did express their dismay at the governor’s comments about 25 times with groans, boos and shouts of “no” and “you’re wrong”. To their credit, they did not resort to foul language or hurling imprecations at the governor–they just disagreed, albeit loudly.
The supporters were not silent in all this. They had many opportunities to cheer and make their own form of “verbal voting” and did so.
It was about the most political excitement I’ve seen in town since the mayoral election.
BTW, the longest outburst was 42 seconds when the governor did his “12 thousand-odd businesses only paid 150 in taxes” bit.
Ah the wonders of digital recording.
Comment by Pravoslavniye Wednesday, Apr 4, 07 @ 5:41 pm