Thursday, December 01, 2011

Taxes and disinvestment

Illinoyed 

Businesses are threatening to leave 

Dec 3rd 2011 | CHICAGO | from the print edition

 THE state finances in Illinois are an ugly mess of deficits, unpaid bills and tax refund backlogs. At the heart of the problem lies a public pension liability estimated at a present value of $80 billion. The state’s pension schemes are only 51% funded, the lowest rate among the 50 states. In January, in an attempt to grapple with its problems, the state raised corporate taxes from 7.3% to 9.5% and personal income tax from 3% to 5%. Although the tax hikes are theoretically temporary—and start to expire in 2015—both the rises and the continued failure of politicians to get to grips with the budget crisis are starting to worry businesses. [More...]

And Republicans in the house are now arguing for a reduction in corporate taxation to stabilise the business climate in Illinois.