Sangamon Sun

State Representative Jeff Keicher has introduced a bill aimed at eliminating the franchise tax in Illinois. The proposed legislation, known as HB2846, seeks to amend the Business Corporation Act of 1983. If passed, it would remove the requirement for domestic and foreign corporations to pay a franchise tax due on or after January 1, 2026.

Keicher argues that the current franchise tax affects mainly small businesses and does not generate significant revenue for the state. "The franchise tax only hits a small handful of mostly mom-and-pop small businesses, doesn’t generate much revenue for the state and keeps other employers from investing in Illinois," Keicher stated. He emphasized that this tax was supposed to be phased out as part of a bipartisan agreement related to the Blue Collar Jobs Act in 2019 but claims that Democrats did not uphold this commitment.

Keicher insists that now is an opportune time to fulfill the promise of eliminating this tax to create a more inviting environment for potential job creators. "Now is the time to eliminate it, as promised, and offer a more welcoming environment to potential job creators," he said.

He further elaborated on his position by stating, “The tax only hits a small handful of mostly mom and pop businesses and the tax doesn’t generate much at all.” Keicher believes removing this tax is "the right and fair thing to do."

In 2019, Illinois House Republicans, House Democrats, and Governor JB Pritzker reportedly reached an agreement which included plans to eliminate several taxes alongside incentives such as those found in the Blue Collar Jobs Act.