Chicago's financial exchanges would see a 50 percent decrease in their Illinois corporate income tax bills under legislation introduced Monday afternoon by Senate President John Cullerton, D-Chicago.
Illinois would tax a fraction of the income generated by the Chicago Mercantile Exchange, the Chicago Board of Trade and the Chicago Board Options Exchange, all of which have threatened to move operations out of state after Illinois temporarily raised its income tax earlier this year.
The bill, which would reduce the exchanges' taxes by tens of millions of dollars, attempts to limit levies on income attributed to Illinois-based transactions and would continue to fully tax income derived from open-outcry transactions on trading floors in Chicago. But those transactions represent a small slice of business now, with most activity having migrated to electronic trading.
Under the proposal, only 27.54 percent of income stemming from electronic trading and clearing fees would be subject to Illinois' corporate income tax, compared with 100 percent now. A spokesman for Cullerton added that the legislation could change in the days ahead.
Michael Shore, a spokesman for CME Group Inc., parent of the Merc and the Board of Trade, declined to comment. But CME Executive Chairman Terrence Duffy told Bloomberg News earlier this year that his company paid $150 million to Illinois last year . . .