,Illinois' Proposed Gross Receipts Tax: A Modified GRT Could Be Paired With Other Tax Changes

Illinois' Proposed Gross Receipts Tax: A Modified GRT Could Be Paired With Other Tax Changes


 

Publication Date: May 2007

Publisher: Center on Budget and Policy Priorities (Washington, D.C.)

Author(s): Elizabeth C. McNichol; Iris J. Lav

Research Area: Banking and finance

Keywords: Fiscal future; Economic projections; Tax code; State budgets

Type: Report

Coverage: Illinois

Abstract:

Governor Blagojevich of Illinois has proposed a new revenue source, a gross receipts tax (GRT), to provide funds for a major health care expansion, public education, property tax relief, and to help address the state’s long-standing budget problems. A GRT is a low-rate tax on the receipts of all types of businesses. The governor’s proposed GRT would exempt retail sales of food and drugs, Medicaid payments, and the receipts of non-profits and industries such as gaming and insurance already covered by other specialized taxes. A GRT in Illinois has a number of significant advantages