SPRINGFIELD, Ill. (AP) — The Illinois House has begun debating a $5 billion income tax increase to help end a two-year budget stalemate.
Democratic Rep. Greg Harris of Chicago is the sponsor of the measure presented Sunday. The plan would increase the personal income tax rate by 32 percent. It would go from 3.75 percent to 4.95 percent. The corporate rate would increase from 5.25 percent to 7 percent.
An expansion of the sales tax on services suggested by a Senate measure has been scuttled.
Sunday marks the second day of the new fiscal year. It’s the third in a row the state has begun without a state budget.
The annual deficit has grown to $6 billion with a $15 billion pile of overdue bills. Credit rating agencies have threatened to downgrade the state’s creditworthiness to “junk” status.