Business groups complain about Illinois taxes
Business groups vented to Illinois lawmakers Tuesday about taxes in the first of four legislative hearings to examine the state’s tax structure after some major employers threatened to pull up stakes.
“Certainly the recent tax increase eliminated what we would view as a competitive advantage Illinois enjoyed,” said Mark Denzler, vice president and chief operating officer for the Illinois Manufacturers’ Association, during testimony at the four-hour hearing in Chicago.
Three more hearings will be held later in Rockford, Springfield and Marion.
Illinois Senate President John Cullerton and House Speaker Michael Madigan, the two Chicago Democrats who control the General Assembly, called for the hearings. They did so after major companies, including the Peoria-based heavy equipment maker Caterpillar and the CME Group, which owns both the Chicago Mercantile Exchange and the Chicago Board of Trade, said they might consider leaving the state over its taxes and its business climate.
Earlier this year, Illinois raised both its personal and corporate income tax rates, sending the corporate rate from 4.8 percent to 7 percent.
Republican Sen. Matt Murphy of Palatine warned against the panel becoming a political show. He said there must be a reduction in taxpayer liability for businesses and individuals.
“There is a palpable fear and growing anger about the jobs situation in this state and nationally,” Murphy said. “And I would caution to the extent that this is some sort of an exercise politically to put a check in a box next to tax reform. And we’re going to kind of nibble at the margins and just say, `Hey, we did tax reform’ and go run on that next November.
“I would caution ... to tread lightly because people are in no mood at this point and time for gimmicks,” he said.
Democratic Sen. Toi Hutchinson of Olympia Fields, one of the chairs of the joint House-Senate Revenue Committee, said it’s too early to say what ultimately will come from the hearings.
“We have not taken a comprehensive look at the overall structure as a whole ... so that we can stop piecemealing things,” she said after the hearing. “So I’m not necessarily ready to say that this is what’s going to happen as a result of this. My goal is clarity, my goal is predictability and my goal is stability — three things that Illinois sorely needs.”
Cullerton announced Tuesday’s hearing with a news release that called on the state’s businesses to play a part in the discussions about taxes. Businesses he named in the release included Caterpillar, which is one of the world’s largest companies, and Archer Daniels Midland and Tate & Lyle — a pair of Decatur-based agricultural processors with thousands of employees in Illinois.
But Caterpillar said it planned to leave discussion of the state’s taxes to the Illinois Manufacturers Association and Illinois Chamber of Commerce. Archer Daniels Midland and Tate & Lyle, which is in the process of moving its U.S. headquarters to Hoffman Estates with the help of tens of millions of dollars in state incentives, said they don’t plan to participate in the hearings but declined further comment.
As part of their work, some lawmakers also want to take a closer look at the incentives the state offers to businesses to see how they’re working, whether anything needs to be revamped and how they’re utilized by smaller companies that might not have the pull of larger companies to wrangle incentives from the state.
“I don’t think there’s anything that we do now that we need to get rid of,” said Rep. Sandy Cole, a Republican from Grayslake.