Wait: Governor’s Tax Increase an Enemy of Farmers

March 22, 2007

Belvidere…State Representative Ron Wait (R-Belvidere) detailed the devastating impact that the Governor’s new tax increase proposals would have on area farmers and consumers.

“The governor’s proposed tax increases will severely hurt our local and state economies if adopted,” Wait said.  “On top of the payroll tax increase Blagojevich is pushing for, his gross receipts tax proposal would also create a new tax on some transactions – like agricultural dealings – that currently enjoy limited tax-freedom.”

Several statewide agricultural associations joined Wait in his opposition to the new tax.  The Illinois Corn Growers Association said that the new tax would add 14% to taxes paid by a typical corn grower in Illinois.  The Fertilizer and Chemicals Association calculated farmers would see an additional tax increase of almost $4,000.  The Grain and Feed Association estimated the governor’s new tax would add $7,655 to a farmer’s tax bill and add $185,000 per year for local grain elevators.  Illinois Pork Producers also project that a hog-farmer’s profit margin will be cut by 25%.

“When a farmer grows corn, soybeans, wheat, or raises livestock, he has to buy equipment, tools, fertilizer, and other necessities from many different sources.  If the governor taxes these sources, the new tax will be passed on to our local farmers,” Wait said.  “To make matters worse, since the prices farmers receive for their goods are tied to the global market, they have to take the full brunt of the tax and absorb the increased costs.”

Wait added, “When all is said and done, some farmers will go bankrupt if the governor’s Gross Receipts Tax is instituted.  As governor of Illinois, a state that leads the world in agricultural production, Blagojevich has shown no leadership or sensitivity with regard to our state’s huge economic ties to agriculture.”