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Small Business Tax Increase Off Table
A proposal that some lawmakers say would have unintentionally imposed a huge tax increase on small businesses and partnerships in Illinois has been repealed.

Legislators say the idea was to close a loophole that some businesses were using to avoid paying certain taxes. They say the businesses were labeling profit as "compensation to partners" in order to avoid paying taxes. Instead, the measure would have forced businesses and partnerships to pay the personal property replacement tax based on their full income, rather than just a portion. That means the amount of tax taken would be calculated based on a much larger number.

State Sen. Larry Bomke (R-Springfield) joined the rest of the Senate in voting to repeal the measure, which he says would have created an undue hardship on these businesses. He says he's not opposed to closing the loophole, but doesn't think it will happen during this fall's veto session. Lawmakers are scheduled to meet through the end of next week.

(Illinois Radio Network)
10 15 09 by Newsroom
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