Today, the Democrat majority in the Illinois House passed legislation, Senate Bill 2803, that puts a tax increase on jobs in Illinois at a time when residents can least afford it. The legislation leaves a $1.8 billion hole in the Unemployment Insurance Trust Fund.
“For months, we’ve been warning Democrats that we have to pay off the debt owed to the federal government in the Unemployment Insurance Trust Fund or risk a tax hike on jobs and cuts to future unemployment benefits,” said State Representative Tim Butler (R-Springfield). “This could have been done by using ARPA and CARES funds, but once again Democrats have chosen to use that money for pet projects, leaving the trust fund vulnerable to another emergency and putting the burden on taxpayers.”
The COVID-19 pandemic has led to a $4.5 billion deficit in the state’s Unemployment Insurance Trust Fund, a debt the state owes to the federal government. Until March 31, 2022, federal rules allow the state to deposit remaining federal ARPA money into the fund. Since the Democrats’ legislation does not fill the complete $4.5 billion hole, the state faces interest penalties that will raise unemployment insurance taxes, making it a tax hike on jobs.
“Many other states faced similar unemployment insurance deficits, but took the responsible route to use available federal COVID-19 relief to replenish their funds,” said Butler. “Illinois’ failure to do the same is another example of serious financial malpractice by the Governor and state Democrats that could have easily been avoided.”