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Record #: O2011-4614   
Type: Ordinance Status: Failed to Pass
Intro date: 6/8/2011 Current Controlling Legislative Body: Joint Committee: Economic, Capital and Technology Development; Finance
Final action: 5/20/2015
Title: Amendment of Municipal Code Chapter 3-20 by modifying Employer's Expense Tax provisions for small businesses
Sponsors: Tunney, Thomas, Maldonado, Roberto, Reilly, Brendan, Pope, John, Pawar, Ameya, Cappleman, James, Smith, Michele, O'Connor, Mary, Laurino, Margaret, Dowell, Pat, Waguespack, Scott, Cardenas, George A., O'Shea, Matthew J., Moreno, Proco Joe, Brookins, Jr., Howard, Fioretti, Bob
Topic: MUNICIPAL CODE AMENDMENTS - Title 3 - Revenue & Finance - Ch. 20 Chicago Employers' Expense Tax
Attachments: 1. O2011-4614.pdf
Related files: R2015-407

WHEREAS, the City of Chicago is a home rule unit of government pursuant to Section 6(a), Article VII of the 1970 Illinois Constitution; and
WHEREAS, pursuant to its home rule power, the City of Chicago may exercise any power and perform any function relating to its government and affairs including promoting the creation of jobs in the City; and
WHEREAS, businesses consider a wide variety of factors in making location decisions, including expected amount of tax to be paid; and
WHEREAS, the City's Employers' Expense Tax has long been recognized as an obstacle to job creation in Chicago; and
WHEREAS, the City's projected revenues from the Employers' Expense Tax for 2011 were set at $19.6 million, which represents less than 1/2 of 1 percent of the total 2011 City budget; and .
WHEREAS, the cost of the City's Employer Expense Tax on Chicago-based employers far outweighs any benefit the City derives from these nominal revenues; and
WHEREAS, the Chicago City Council took a very positive step in 1995 to reduce the level of tax required of many businesses and eliminated the tax altogether for businesses with fewer than 50 employees; and
WHEREAS, Chicago realized job growth in the years following the reductions in the City's Employers' Expense tax, particularly among its smaller businesses; and
WHEREAS, this job growth, particularly among smaller employers has slowed substantially in the past few years; now, therefore
SECTION 1. Chapter 3-20 of the Municipal Code is hereby amended by deleting the language in brackets and adding the language underlined as follows:
3-20-030 Employers' expense tax.
A. A tax is hereby imposed upon every employer who, in connection with the employer's business, engages, hires, employs, or contracts with 50 or more individuals as commission merchants and full-time employees, or any combination thereof, to perform work or render services in whole or in part within the City ...

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