Small-business owners, partnerships and investment partnerships have reason to be concerned about a bill introduced in the Illinois General Assembly in February, which would hike and expand one of Illinois’ business income taxes.

House Bill 4798, sponsored by state Rep. Emanuel “Chris” Welch, D-Hillside, would raise the rate of the Personal Property Replacement Tax, or PPRT, to 7.5 percent from 1.5 percent for a variety of businesses. The bill would also add investment partnerships to the list of businesses that are subject to the PPRT.

The state created the PPRT in 1979 as a replacement for revenue lost when the state revoked local governments’ power to tax certain business property. Today, the state collects PPRT revenue and then sends that money to units of local government.

The new bill keeps the 2.5 percent PPRT rate paid by corporations, but raises to 7.5 percent the rate that partnerships, limited liability companies, trusts and Subchapter S corporations, or “s corps,” must pay.

Currently the Illinois Income Tax Act requires partnerships, trusts and s corps to pay a 1.5 percent PPRT.

The bill’s proposed hike is a 400 percent increase in the PPRT rate that entities such as partnerships and many LLCs would have to pay. Structures such as LLCs are preferred by many of Illinois’ 1.2 million small businesses, which would be hit especially hard by the 400 percent tax hike.

In addition, the bill revokes an exemption previously afforded investment partnerships, subjecting them to the 7.5 percent PPRT rate that will apply to other partnerships.

The hike in rates and the expansion of the PPRT to investment partnerships would land yet another blow on businesses and individuals who have just taken a major hit from the state.

In July 2017, the General Assembly raised corporate income taxes to 7 percent from 5.25 percent, and individual income taxes to 4.95 percent from 3.75 percent. Like those taxes, the PPRT is “imposed on the privilege of earning or receiving income in or as a resident” of Illinois.

And unfortunately, rising income taxes aren’t the only tax burden Illinois businesses and business owners bear. They are also subject to some of the highest property taxes in the nation.