State rep. Jeff Keicher proposes eliminating franchise tax

SYCAMORE – State Rep. Jeff Keicher, R-Sycamore, has filed a bill in Springfield that would eliminate the franchise tax in Illinois.

That bill, HB2846, would amend the Business Corporation Act of 1983 so that domestic and foreign corporations are not required to pay a franchise tax that would be due or payable on or after Jan. 1, 2026.

Keicher said the franchise tax isn’t currently hitting the businesses you’d expect.

“The tax only hits a small handful of mostly mom and pop businesses and the tax doesn’t generate much at all,” Keicher said.

Keicher said he believes “it is the right and fair thing to do.” He said Illinois House Republicans, House Democrats and Illinois Gov. JB Pritzker had a deal in 2019 to eliminate the franchise tax along with the data center incentive, Blue Collar Jobs Act, manufacturer purchase credit, and research and development credit.

“Since it was part of an agreement that Democrats walked back on I feel [it’s] the right thing to get it done as as one of the folks that voted for it then,” Keicher wrote. “I want to carry out the promises made in 2019.”

The Illinois Department of Employment Security revised the December unemployment rate to 4.9%, down from the preliminary report of 5.2%, according to a department news release on Wednesday.

The preliminary unemployment rate for the state in January was also 4.9%, up 0.9% from the national average, according to the Illinois Department of Employment Security.

Keicher said he believes if Illinois had an unemployment rate that matched the national average, there would be tens-of-thousands of more jobs in the state.

He argued that Democrats in the state legislature have implemented repeated measures that chase away or discourage job creators from considering Illinois.

“The franchise tax is one of those that keep employers from investing in Illinois,” Keicher wrote. “So my ask would be, let’s be average and welcome job creators.”