Illinois Tax Hikes Will Hurt Companies

Federal stimulus counter balanced by increased State deterrence.

Headline: Illinois tax hikes will hurt companies

The major tax hikes passed by Illinois lawmakers early Wednesday will hit businesses hard.

Faced with a daunting $13 billion budget deficit, state legislators opted to raise personal and corporate income taxes. Companies will now have to pay a 7% corporate tax rate for the next four years, up from the previous 4.8%. And Illinois businesses are already subject to a 2.5% surcharge.

Pat Quinn said that putting the state on a sound financial footing will improve economic growth. But at a time when sales are still suffering from the economic malaise, the hike may prompt some companies to relocate or deter them from investing.

Source: money.cnn.com