We are back in Springfield tomorrow as we begin the final two weeks of the spring legislative session. We only have nine scheduled session days left before our May 31 adjournment date and the deadline to pass a state budget. We have yet to see a budget proposal from our Democrat colleagues. On top of that, the Governor’s Office of Management and Budget lowered revenue projections for FY26 by more than $500 million last week. House Republicans will continue to stand for fiscal sanity. We will not negotiate a budget with ANY tax hikes.
Proposed Service Tax
House Republicans Raise Alarm on New Service Tax Proposal. Illinois Democrats have a new proposal making the rounds in Springfield that would establish a new sales tax on services across the state. This new service tax would cover almost all services consumers rely on, ranging from streaming services to dry cleaning, haircuts to vehicle repairs, and everything in between. Proponents are pushing the new tax as a bailout to fill the void for years of mismanagement in the Chicago region’s mass transportation system, which is facing nearly a billion-dollar budget shortfall in 2026.
Over 73% of the Illinois economy is service-producing industries, and most are not currently set up to pay sales tax. Rushed implementation under this proposal will lead to many businesses choosing not to operate in Illinois.
State Representative Mike Coffey said he has great concerns about the sales tax increase proposal:
“Proposals of raising taxes again on working families is outrageous when our state is in dire need of policy reform that offers taxpayers relief,” said Coffey. We must set better priorities and pass legislation that keeps families in Illinois so they can prosper, and not be burdened by high taxes.”
Dean Graven, Owner and Operator of Dean’s Landscaping and Handyman Services, and a former President of the Springfield Home Builders Association and past board member of the Home Builders Association of Illinois, said the tax would have a major impact on housing costs.
“A new service tax will have a terrible impact on housing affordability in Illinois and will serve to stifle new construction rates,” said Graven. “Home builders rely on contractors and subcontractors providing services. Think of all the services that go into building a home – carpenters, electricians, plumbers, HVAC, roofers – under a new service tax, all of these additional taxes will be passed along to consumers. Let’s be clear, a tax hike on services is a tax hike on all Illinois families.”
More than eighty services appear in the new tax proposal, including car washes, streaming services, landscaping, home repair/handyman services, employment staffing agencies, camping, dry cleaning, carpet cleaning, fitness centers, pest control, dog grooming, retirement/investment advising, moving services, and many more.
For a complete list of the services included in the tax proposal and to express your opposition to this major tax expansion, go to StopILServiceTax.com.
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