Businesses worry about proposed "opportunity tax" - WSIL-TV 3 Southern Illinois

Businesses worry about proposed "opportunity tax"

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CARBONDALE -- As part of a deal to help end Illinois' state budget crisis, Illinois Senate leaders are considering a 13-bill package. One of those bills would increase taxes on businesses based on payroll.

Marilynn Martin, owner of Mary Lou's Grill in Carbondale, says she's already struggling to keep the family business going.  

"As you can see right now, we have an empty counter. It's noon hour," said Martin. 

She says people are eating out less and less, and another tax would make keeping their doors open even harder.

"I'm probably going to have to cut back to maybe four days a week instead of five or I'm going to have to lay off some people," said Martin.  

The proposed "opportunity tax" would tax every business based on their payroll. For example, a business that pays out less than $100,000 a year would be taxed $225. Businesses like Mary Lou's, with a payroll of more than $100,000 and less than $250,000, would pay $750. Martin says that's more than she can pay.   

"We will still be paying something more and I don't have the budget for it at all," said Martin.  

For businesses with a higher payroll, like Carbondale's Neighborhood Co-Op, they'll end up paying $7,500 each year in "opportunity taxes."

General Manager Francis Murphy says if this tax is passed, he fears even more businesses will leave Illinois. 

"I mean, Illinois is losing residents at an unbelievable clip, like one resident every five minutes to other states, so I don't think this is the right solution to the problems of state government," said Murphy.  

He says if it does end up passing, they may end up having to raise prices to compensate. Something larger companies may not have to worry about. The opportunity tax caps at $15,000.

Still, for small business owners like Martin, they hope the tax does not get approved but says she'll keep working to keep her business open.

"We are fighting for everything we get in here. We really are," said Martin. 

Those 13 bills only become law if all are approved in the Senate and the House and signed by Governor Rauner.  As part of this deal, the $11 minimum wage was thrown out and a tax on sugary drinks was also tossed.

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