Post by robeiae on May 30, 2017 8:14:00 GMT -5
Despite the name, this is not a tax aimed at people exercising their "privilege," be it "white" or something else. Rather, it's taxing people (firms) for the privilege of doing business in Illinois.
Details:
Of course, the Illinois tax would be going into State coffers, not Federal ones, which in my mind indicates two truths about the proposal:
1) It's cash grab for a State who finances are a total disaster.
2) It's punitive.
Anyway, a version--with the above stipulation removed--of the bill has now passed the Illinois Senate and is headed back to the House:
The obvious question being begged (noted in both articles): why would these firms continue to set up shop in Illinois, given this tax?
Details:
House Bill 3393, a “privilege tax” proposal from state Rep. Emanuel Chris Welch, D-Hillside, would hit partnerships and S corporations engaged in investment management services with a 20 percent tax on fees earned from their investment strategies.
The measure is intended to compensate for a federal provision that taxes carried interest earned by investment firms at the capital gains rate, rather than at the higher ordinary income rate. HB 3393 provides that the Illinois privilege tax would cease if Congress passes and the president signs a comparable bill changing federal tax law.
The measure is intended to compensate for a federal provision that taxes carried interest earned by investment firms at the capital gains rate, rather than at the higher ordinary income rate. HB 3393 provides that the Illinois privilege tax would cease if Congress passes and the president signs a comparable bill changing federal tax law.
1) It's cash grab for a State who finances are a total disaster.
2) It's punitive.
Anyway, a version--with the above stipulation removed--of the bill has now passed the Illinois Senate and is headed back to the House:
It passed the state Senate in a 32-24 vote Tuesday, and backers are hoping to get it through the House before the legislative session ends May 31.
The new tax is pitched as a way to squeeze more revenue—as much as $1.7 billion a year—from hedge funds and private-equity firms, which purportedly get off easy on their federal taxes because of the “carried interest loophole.” But under the current version of the bill, Illinois would keep collecting the privilege tax even if Congress were to cease taxing carried interest at the lower capital-gains rate.
The new tax is pitched as a way to squeeze more revenue—as much as $1.7 billion a year—from hedge funds and private-equity firms, which purportedly get off easy on their federal taxes because of the “carried interest loophole.” But under the current version of the bill, Illinois would keep collecting the privilege tax even if Congress were to cease taxing carried interest at the lower capital-gains rate.
