Small Business Economic Incentive Act
Illinois is home to 1.3 million businesses with fewer than 20 employees, accounting for over 97% of all companies in the state. These small businesses create jobs and foster economic development in communities across Illinois. While larger employers are worthy of support, policymakers should do more to champion the small businesses that drive our economy.
The SBAC examined six economic incentive programs and found that just one percent of awards went to businesses with 50 or fewer employees in 2024. Sufficient data to evaluate several other economic incentive programs is not publicly available. The SBAC is championing legislation that will allocate 50% of future tax incentives to small businesses.
The fiscal difficulties facing our state leave little room to sacrifice additional tax revenue on incentives. This should not stop policymakers from distributing tax credits more fairly.
Almost every large business was once a small business. Countless companies got their start in Illinois and remained in the state as they grew into successful multinational enterprises. Illinois should do everything possible to grow small businesses when they need help most.
Thirty-eight percent of small business failures stem from a lack of capital—a gap the state is well-positioned to address. Even modest investments can have an outsized impact: 58% of U.S.-based businesses launch with less than $25,000 in funding. Illinois should invest more in its existing vibrant small business community and help aspiring entrepreneurs get their start.
Let’s allocate a fair share of state incentives to small businesses. The SBAC will collaborate with policymakers to design programs that effectively support the small business community.