$55.9 billion budget includes new taxes, ‘no property tax relief’

By Jim Talamonti | The Center Square
The Center Square

(The Center Square) – The Illinois General Assembly has voted to approve a record-high budget for fiscal year 2027, with new taxes and lawmaker pay raises included.

The $55.9 billion spending plan breaks the state record of $55.2 billion set in fiscal year 2026.

State Sen. Elgie Sims, D-Chicago, said the new budget is balanced.

“I would remind this committee and the public that there are no tax increases on everyday working families,” Sims said on Sunday afternoon.

The budget passed early Monday morning includes new taxes on targeted advertising services, digital assets, social media platforms and fantasy sports, limits certain income tax carryover deductions and raises the tax on retail tire sales from $2 to $2.50.

State Sen. Chapin Rose, R-Mahomet, said state spending has increased 40% since J.B. Pritzker became governor.

“Healthy states don’t need new taxes. Why? Because they’re growing. Healthy states aren’t punishing their citizens with this tax burden which is directly correlating into the overall economy,” Rose said.

Rose said Illinoisans pay $1,700 more in taxes than the national average.

The new budget freezes the state’s motor fuel tax for six months. Instead of rising to 49.6 cents per gallon as scheduled on July 1, Illinois’ tax on regular unleaded will remain 48.3 cents per gallon until Jan. 1, 2027.

Surplus gas tax revenue will be redirected to general operating funds. Rose questioned why the state would sweep nearly $150 million in gas tax revenues, approximately the same amount appropriated to fund immigrant health and welcoming center programs.

The budget leaves the Local Government Distributive Fund percentage at 6.47% of state income tax revenues, even though Gov. J.B. Pritzker proposed cutting the rate to 6.23% for fiscal year 2027.

Statehouse Republicans opposed the governor’s cut and pushed for property tax relief.

“There is no property tax relief in this revenue package,” state Rep. Curtis Tarver, D-Chicago, said on the House floor Sunday night.

Speaking on the House floor last Wednesday, state Rep. Brad Halbrook, R-Shelbyville, predicted what would happen over the weekend.

“Here we are again, the final week of session in Springfield, a deadline that has been on the calendar for months, and yet somehow we end up in the exact same place: budget deals negotiated behind closed doors, massive spending bills dropped at the last minute and rumors of new tax increases surfacing in the final hours when the public is least likely to notice,” Halbrook said.

Halbrook, a member of the Illinois Freedom Caucus, said the General Assembly goes back to the same failed playbook year after year.

“Spend beyond our means, refuse to tell Gov. Pritzker ‘no’ and create yet another budget problem, then turn around and demand taxpayers bail Springfield out once again,” Halbrook said.

Illinois House Speaker Emanuel “Chris” Welch, D-Hillside, and Senate President Don Harmon, D-Oak Park, said on May 7 that more than 90 pieces of budget legislation would be consolidated and introduced as House Bill 131 and Senate Bill 2512.

On Saturday, however, the 3,551-page budget document was dropped into an amendment for House Bill 111.

On Sunday, the 1,623-page revenue document dropped into an amendment for Senate Bill 3019.

The budget includes a 3.2% cost-of-living raise for state lawmakers, pushing their average base salary over $101,000.

If signed by Gov. J.B. Pritzker, the budget will take effect on July 1.

Greg Bishop and Sean Reed contributed to this story.