A state representative’s idea to tax Chicago financial markets is heading for a hearing June 7. But the president of a major exchange said if the state enacts such a tax, his exchange could leave Illinois.
State Rep. Mary Flowers, D-Chicago, recently explained her “LaSalle Street tax” as a way to balance Illinois’ books and pay for schools and other social services. The bill would place a $1 or $2 fee on each trade made in the state. Flowers called this the fair thing to do with so many Illinoisans in need.
Carbondale lawyer Richard Whitney said wealthy speculators are anchored to Illinois by their infrastructure and business relationships, so there’s no risk of the state’s losing those businesses.
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“The exchanges just got a huge tax break from the state three years ago,” Whitney said. “Why would they suddenly pack up and move now?”
Chicago Mercantile Exchange President Terry Duffy sat down next to Flowers and told her his exchange can leave Illinois whenever it pleases.
“We don’t own any real estate in Illinois, and that’s on purpose,” Duffy told a committee. “The professor says I have a 15-lease (on our facility). He’s absolutely correct. He didn’t read the lease, though. He didn’t read where I have the ability to go to 29 other centers in the United States that would facilitate my business.”
Duffy had some sharp words for the claim that a dollar-per-trade tax would be miniscule.
“This is an 800 percent tax increase on the traders that work on our exchange today. Would they move their business? Absolutely.”
Gov. Bruce Rauner said a transactions tax would harm Illinois’ economy and that the exchanges would all simply leave.
A hearing on the transactions tax is set to take place before the House Revenue and Finance Committee on June 7.