A Publication of WTVP

Faced with a July deadline to find an additional $55 million for the Chicago Transportation Authority or risk service cuts, Chicago Democrats are now looking to raise taxes on Illinois’ small businesses to fund the Chicago Transportation Authority (CTA) and its bloated bureaucracy. Chicago legislators, along with the governor, have proposed implementing a “licensed pre-written software” tax that would raise $65 million in new taxes at the expense of Illinois jobs and employers.

I recently held a news conference at a small technology business in my district, Infogenic Systems. I was joined there by Tom Goelzer of Infogenics and by the president of STL Technology Partneres, Tim Norman.

Those two companies are competitors, but they came together to express their opposition to the imposition of this new tax on software. Officials of both companies said what they fear most is having Illinois put them at a competitive disadvantage with businesses in other states and other nations.

Norman said if the tax was imposed, STL would have to move 100 to 150 employees to Iowa. Downstate Illinois can’t continue to bail out poorly performing Chicago government agencies every time they get in trouble.

The answer for the CTA is internal reform from top to bottom. Once that’s made, I’m confident downstate legislators would be willing to work cooperatively on a solution. At this time, however, giving more state funds to the CTA would be like giving liquor to an alcoholic.

The governor’s plan would call for implementation of a tax on licensed pre-written software purchased by small, medium, and large businesses alike. In general, this software is designed and geared toward a specific function within a company. These types of software packages little resemble typical software one would purchase in a store. Currently in the state, packaged software for large-scale implementation is sales tax exempt. This proposal would affect thousands of employers.

If you tax something, you get less of it. This is a tax on employers, and if it’s enacted, I believe it will lead to fewer employers in Illinois—just as the tax and fee increases of the governor’s first two years have done.

Creating economic growth is essential to providing economic opportunity for all people in Illinois. Growth in our business and job base is the only way our state will be able to adequately address education funding, health care, and transportation infrastructure needs and other pressing needs. This is why I’ll fight hard to prevent this short-sighted and unfair tax hike. IBI