When politicians work together, the taxpayers pay more. That may be the message that Illinois voters take from a Senate committee’s latest action.
People who wish for elected officials to work together may have to rethink their positions after the Illinois Senate Revenue committee unanimously approved a new tax on plastic bags sending the measure to the Senate floor for approval. While the committee members and big business were working together, the increased tax falls on the family shopping for groceries.
Senate Bill 1240, the brain child of Senator Terry Link, a Democrat from Lake County, creates the “Checkout Bag Tax Act”.
The legislation, which was supported by 5 Democrats and 2 Republicans, as well as the Retail Merchants Association, imposes a tax of seven cents on each checkout bag used by a customer at a retail establishment in the State.
According to the legislation, a”checkout bag” means a single use plastic, paper, or compostable bag provided by a retail establishment at the checkout, cash register, point of sale, or other point of departure to a customer for the purpose of transporting goods out of the retail establishment. It includes the bags customers use to take home food from restaurants.
The bill splits the pot in a way to get support from the various stakeholders while ignoring the fact that people will have to pay the tax. The retailer keeps two cents and the wholesaler also is given two cents per bag. Three cents per bag will be deposited into the “Checkout Bag Tax Fund”. The money from that fund will be given to counties and municipal joint action agencies.
The bill excludes the municipalities of Chicago, Oak Park and any other municipality which had a bag tax on the books as of Feb. 1, 2018. Oak Lawn does not have a bag tax. As such, retailers and restaurants will begin collecting the tax if it passes.
Governor JB Pritzker had announced support for a bag tax that he claimed would raise $19 to $23 million dollars in revenue for the state. This bill doesn’t seem to raise money for the state but negotiations are ongoing and retailers or the wholesalers may be cut out to give the state a share.
The City of Chicago passed a plastic bag tax of five cents and at the time projected that it would raise $9.2 million for its coffers. However, Chicago collected $5.6 million in 2017 and $5.9 million last year from the bag tax according to its own Department of Finance.
A 2017 study showed a 42 percent reduction in bag use after the tax was implemented and environmentalists have argued that the reduction is a good result.
The bill also exempts bags used to transport items purchased using the Supplemental Nutrition Assistance Program (SNAP), also known as food stamps, or items purchased using other government aid programs.