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September 20, 2019
State and Local Tax
This Week
Illinois General Assembly
The House and Senate have adjourned until the fall veto session. The first week of the veto session is scheduled to begin on October 28. The second, and final, week of the veto session is scheduled to begin on November 12.
New legislation
HB 3887 - (Wehrli and Ugaste) - Creates the Flavored Tobacco Ban Act. Provides that a tobacco retailer or his or her agents or employees may not sell, offer for sale, or possess with the intent to sell or offer for sale, a flavored tobacco product, flavored related tobacco product, flavored alternative nicotine product, or flavored solution or substance intended for use with electronic cigarettes.
HB 3890 - (Bennett) - Amends the Use Tax Act and the Retailers' Occupation Tax Act to repeal the limitations on trade-ins of automobiles enacted as a portion of SB 690 (P.A. 101-0031)
HB 3891 - (Spain) - Amends the Use Tax Act and the Retailers' Occupation Tax Act to repeal the limitations on trade-ins of automobiles enacted as a portion of SB 690 (P.A. 101-0031)
Franchise Tax Amnesty
The Illinois Secretary of State has posted a Franchise Tax Amnesty Fact Sheet
Property Tax Reform Task Force
As I noted last week, the Property Tax Relief Task Force established a number of subcommittees. The subcommittees are holding hearings. Here is a
link to the Task Force webpage, which contains some limited information about previous and upcoming hearings.
The subcommittee on Assessments and Exemptions met last Friday and head a presentation from Cook County Assessor Kaegi. The Assessor spent the overwhelming majority of his time discussing
SB 1379
, the Assessor's legislation that would require extensive information reporting by owners, and some tenants, of income-producing property. As you will recall, the Illinois Chamber and many other business organizations strongly oppose this legislation.
The subcommittee on Assessments and Exemptions is scheduled to meet again this afternoon. Testimony will include Representative Mayfield, who at last Friday's meeting expressed her strong opposition to the Assessor's legislation, SB 1379.
I attended the subcommittee hearing on TIFs on Wednesday. Most of the discussion at the hearing was by a group of panelists who engaged in a somewhat academic discussion of the efficacy of TIFs as a economic development tool. The subcommittee is scheduled to meet again on September 25 and representatives of various teachers unions are scheduled to testify.
A subcommittee on PTELL met on Monday. I was unable to attend that meeting. The PTELL subcommittee is scheduled to meet again next week.
The subcommittee on Government consolidation met on Thursday afternoon. The subcommittee took testimony on issues related to the efficacy of consolidation of governmental units, both pro and con.
Rulemaking
The September 20 edition of the Illinois Register contained one proposed rulemaking by the Illinois Department of Revenue. The new rulemaking would amend the Department's income tax rules to add a new Section 100.4100. The rulemaking is described by the Department as providing guidance on the proper taxable years to be used for Illinois income tax purposes.
The rulemaking quotes applicable provisions of IITA Section 1501(a)(23) the definition of the term "taxable year" and IITA Section 401(a) that discusses the taxable year of any person required to file a return under the IITA, but not under the Internal Revenue Code.
The rulemaking also discusses short taxable years and changes in a taxpayer's membership in a unitary business group in situations where the taxpayer's taxable year does not terminate at the time of the change for federal income tax purposes. Let me know if you have any questions or comments on the rulemaking.
The September 20 Illinois Register did not contain any proposed or adopted rulemakings by the Illinois Department of Commerce and Economic Opportunity.
Court cases
Iwan Ries & Co. et al. v. City of Chicago was argued before the Illinois Supreme Court on Tuesday. One of the plaintiffs in the case is Tax Institute member Arangold. The case was argued by Stan Kaminski of Tax Institute member law firm Duane Morris. At issue is whether the City of Chicago had the authority to enact a local tax on tobacco products in 2016. The briefs of the parties can be found at this
link.
Tax Tribunal
No new decisions were posted this week.
None of the new cases filed at the Tribunal raise any novel issues.
Publications
The Institute on Taxation and Economic Policy ("ITEP"), what i would characterize as a left of center group recently issued a report entitled
"Promoting Greater Economic Security Through a Chicago Earned Income Tax Credit: Analyses of Six Policy Design Options". I flag this report because ITEP has support among the progressive elements of the Illinois General Assembly and the Chicago City Council and such a program would have to be paid for somehow. ITEP's general approach to these types of proposals is to introduce legislation and pay for the program through higher taxes on the business community.
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