But, according to the National Federation of Independent Businesses (NFIB), the proposal would only apply to C corporations, leaving out S corporations. Many small businesses are classified as S corporations.
With an S corporation classification, businesses pay the personal income tax rate of 5 percent. Noonan’s Hardware, in Springfield, is among them. Owner, Matt Noonan III, says a corporate tax cut would give his competitors an advantage, strengthening their bottom lines and, at times, allowing them to offer lower prices.
The tax break proposal is part of a broader conversation on tax reform in Illinois. The personal income tax rate is set to start decreasing in 2015, leaving the state with less revenue. Speaker Michael J. Madigan (D) says the bill would provide corporations $500 to $700 million in savings in its first year, and as much as $1.5 billion in the following year.
“I am hopeful this legislation will encourage CEOs to grow their work forces with good paying jobs,“ Madigan said in a statement.
Copyright 2015 Nexstar Broadcasting, Inc. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.