SPRINGFIELD - State senators are again floating a plan to offer amnesty to tax scofflaws in an attempt to boost sagging state revenues.
A similar proposal sank last year.
State Sen. James Clayborne, D-Belleville, recently introduced a new bill that would offer immunity from criminal and civil prosection and waive interest and penalties for anyone who settles their tax debt to the state during a two-month window this fall.
Half of the money collected would go to the common school fund and half into the state's general account.
The bill would offer an added incentive, in that delinquent taxpayers eligible for the amnesty who did not take advantage of it would face interest and penalties 200 percent higher than they already owed.
Clayborne introduced the measure last year, too, but that was before his party took control of the Senate and the governor's mansion.
?It's a new administration and we believe that there are different opportunities now that would give this bill a chance,? he said.
Since the early 1980s when tax amnesties were first implemented, nearly every state has tried such a program at least once.
Massachusetts and New York are currently offering tax amnesties, and Arizona, Connecticut, Kentucky, Michigan, Missouri, Nevada, New Hampshire, New Jersey, Ohio, Oklahoma and South Carolina each did so sometime in the last year.
?Amnesties tend to be a good leading indicator of budget problems,? said Verenda Smith, government affairs associate for the Federation of Tax Administrators in Washington, D.C. ?One of the advantages of an amnesty is that it speeds up cash flow, and there are times when getting dollars in the door today, as opposed to getting a few more dollars in the door tomorrow, becomes very important.?
Supporters say a tax amnesty can not only raise cash for the state, but also lead to the discovery of people who have not been filing their taxes or have been underreporting, which can increase tax rolls in years to come.
But often much of the money that comes in during an amnesty period is money that would have been collected at some point anyway.
Another possible downside is that amnesties can irritate honest taxpayers who have been paying their taxes in full and on time, Smith said.
The last time tax scofflaws were offered amnesty in Illinois was in 1984, according to Department of Revenue spokesman Mike Klemens.
That first amnesty period generated about $160 million, but doing it again this year would not be as lucrative, Klemens said.
?You had a larger group than you would have at this time,? Klemens said.
He did not have an estimate on how much money a tax amnesty could bring in this year.
About $900 million in unpaid taxes is currently owed to the state, but much of it is very old debt from corporations that have long gone out of business.
There could also be costs to run the amnesty program.
?For the last one they added a number of personnel and they spent a fair amount of money on advertising,? Klemens said.
Gov. Rod Blagojevich said this week that every revenue option is on the table, with the exception on an increase in the income or sales tax.