The Illinois General Assembly passed a $56 billion general funds budget—the largest in state history—and then gaveled out during the early morning hours of June 1, 2026.
To fund higher spending totals, the General Assembly voted to raise a number of taxes and fees, including:
– New taxes on prediction markets, fantasy sports, crypto brokers, social media companies, and tobacco products
– New taxes on digital advertising
– Continued limitations on the net operating loss deduction
– A decoupling from the IRS 1202 exemption
The tax provisions are expected to generate at least $800 million in new tax revenue. Some of them, such as the social media tax and the digital advertising tax, could see court challenges.
In a hat tip to struggling consumers, the General Assembly pushed back for six months the 1.3 cent CPI adjustment to the state’s motor fuel tax that was scheduled to go into effect on July 1 and created an August 7-16 back-to-school sales tax holiday on school supplies.
The General Assembly also passed numerous other bills that impact employers and the workplace, including legislation to give the attorney general more power to investigate employers, expansions to the employment section of the Illinois Human Rights Act, and a new paid leave mandate for employees serving on jury duty.
After opposition from NFIB and other groups, the General Assembly opted against passing minimum wage hikes, far-reaching workplace temperature regulations, unemployment benefits for striking workers, and a significant prevailing wage expansion.
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