Op-Ed: Illinois Is Failing Its Small Business Owners. Here’s How We Fix It

llinois loves to tout itself as a business-friendly state. But if you’re a small business owner or entrepreneur making less than $150,000 a year, the truth feels very different.

You don’t have lobbyists in Springfield. You don’t have tax loopholes carved out for you. And you're not sitting on state boards or collecting subsidies. You're grinding every day to provide a service, build something meaningful, and support your family—often with little to no help and a mountain of red tape in your way.

Illinois doesn’t just overlook its small business owners. It actively discourages them.

Ask any local entrepreneur trying to grow a business in this state and you’ll hear the same story:

• Outrageous licensing fees

• Endless compliance mandates

• Delays in permits

• Onerous taxes

• And a bureaucracy that makes the DMV look efficient

For those making under $150,000—a group that includes everything from your neighborhood baker to the freelance graphic designer—the system isn’t just unfriendly, it’s hostile. And it’s driving talent, innovation, and generational wealth creation right out of Illinois.

What’s Broken

Start with taxes. Illinois hits small businesses from every direction: high property taxes if you own your space, steep self-employment taxes, and punitive penalties for even the smallest missteps in paperwork. Many small business owners end up paying more, proportionally, than major corporations with teams of lawyers and accountants to game the system.

Next, consider the state's complex regulatory environment. Illinois has over 250 different occupational licenses—many of which are outdated, redundant, or unnecessary. A hair braider shouldn’t need more licensing hours than a paramedic. Yet here we are.

And don’t forget about access to capital. While large companies get tax incentives and fast-tracked grant programs, small business owners—especially those in minority and working-class communities—are left with underfunded loan programs and vague promises of “equity.”

If you want to encourage entrepreneurship, you don’t punish the very people trying to bootstrap their way into the middle class.

What Needs to Change

If Illinois is serious about becoming a hub for innovation and small business growth, it needs to take immediate, decisive action. Here’s how:

1. Create a Microbusiness Tax Tier
   Businesses making under $150,000 a year should qualify for a simplified, lower tax rate. Period. These are not conglomerates gaming the system—these are everyday people keeping communities alive.

2. Streamline Licensing and Permits
   Cut the red tape. Reduce or eliminate licensing fees for non-healthcare microbusinesses. Create a 30-day guaranteed timeline for state and local permit approvals.

3. Launch a “Fast Track” for Startups
   Small entrepreneurs should have access to a one-stop portal for registering their business, accessing free legal templates, connecting to local grants, and getting mentorship from seasoned professionals.

4. End Predatory Inspections
   Local municipalities often use surprise inspections and fines as revenue generators. That needs to stop. Move toward transparency, education, and grace-based enforcement for first-time infractions.

5. Reform Commercial Property Taxes
   Allow abatements or freezes for small business owners leasing or owning property in underserved communities. Don’t tax them out of the neighborhoods they’re trying to help rebuild.

6. Reinvest in Local Commerce Zones
   Provide direct support to local main streets—fund façade improvements, offer low-interest loans for business expansions, and create safe public spaces that drive foot traffic.

7. Protect Independent Contractors and Freelancers
   Ensure legislation doesn't unintentionally harm gig workers and creatives by making it harder for them to operate independently. Flexibility is key in the modern economy.

A Moral and Economic Imperative

This is more than just economics. Supporting small business is about restoring dignity to work, opportunity to families, and power to communities. Illinois cannot afford to keep punishing those trying to create something from nothing. When we make it easier for everyday people to start and sustain a business, we don’t just grow the economy—we grow independence, pride, and civic engagement.

Let’s stop treating small business owners like ATM machines for the state.

Let’s build an Illinois where working-class entrepreneurs thrive—not just survive. Let’s foster an economy that works from the ground up—not from the top down.

Because when small businesses grow, Illinois grows with them.