This spring, Democrats in Springfield passed a $55.2 billion state budget for Fiscal Year 2026, the largest in Illinois history. To pay for it, they leaned on over $1 billion in new taxes and fund sweeps and paused statutory transfers.
“Tax-and-spend Democrats are thriving in Illinois,” said House Minority Leader Tony McCombie. “But their success is coming at a steep cost to working families who are already stretched to the limit.”
Among the most controversial ideas floated during budget negotiations was a service tax, a plan to tax over eighty everyday services like parking, haircuts, dry cleaning, and even oil changes. While that specific proposal didn’t make it into the final budget this spring, House Republicans are warning that it’s not off the table for long.
“We fully expect the service tax conversation to come back during veto session this fall,” said Deputy Minority Leader Norine Hammond. “This is a clear sign that Illinois families and small businesses are going to be asked to do more while government continues to spend more. A service tax will drive up the cost of living even more for Illinois families.”
Instead of cutting spending or providing tax relief, Democrats passed a patchwork of targeted tax increases and budget maneuvers. The new law hikes taxes on tobacco and nicotine products, raises fees on sports betting, and adjusts business tax rules to bring in tens of millions more. Meanwhile, a one-time tax amnesty program was approved to collect back taxes, projected to raise hundreds of millions.
But Republicans like McCombie and Hammond realize that behind every line item is a family trying to make ends meet.
“Illinois families cannot afford and should not have to pay service taxes on top of the enormous tax burden they already pay,” McCombie said. “Instead of making tough decisions and solving the problem, they’re passing off the burden to hardworking taxpayers who are already struggling.”
Rep. Hammond was especially critical of the decision to sweep hundreds of millions from dedicated funds like the Road Fund and delay payments into the state’s Rainy Day Fund. “They’re papering over budget holes with temporary fixes,” she said. “At the end of the day, it’s not sustainable, and it’s not fair to taxpayers.”
More tax hikes could be on the horizon. Democratic lawmakers are still calling for additional revenue, proposing taxes on home deliveries, digital advertising, capital gains, and even wealth-based assessments. Republicans say they’re bracing for an aggressive push this fall, one that could reshape Illinois’ tax structure and hit middle-class families hardest.
“There’s always another tax on the horizon,” McCombie said. “But instead of finding new ways to take more, we should be focused on doing more with what we already have. Illinois working families deserve better.”
As the State heads toward the fall veto session, House Republicans have made their position clear: they’ll fight any renewed push for a service tax or new burdens on families, seniors, and small businesses. They’re encouraging constituents to stay informed and stay vocal.
“The people of this state are smart,” Leader McCombie added. “They know when they’re being asked to pay for government’s mistakes. We’re standing with working families over bloated government spending.”