In a desperate revenue grab, the State of Illinois has proposed a state wide financial transaction tax squarely targeting CME Group. Does Illinois really want to force CME to leave the state?
As Illinois grapples with a budget crisis, lawmakers are floating an old idea in their search for new revenue: a tax on trading on exchanges based in the state. The bill is...targeting trades on the Chicago Mercantile Exchange, Chicago Board Options Exchange and other markets.... Illinois isn’t alone in wanting to tax traders. European lawmakers have discussed the idea, as have both Democratic candidates for U.S. president. The Illinois proposal would impose a tax of $1 per contract for transactions where an agriculture product is the underlying commodity and $2 per contract for everything else, including futures and options. The bill exempts trades in retirement accounts and those involving a mutual fund. “Would they move their business? Absolutely.” Duffy said CME has the flexibility to leave the state, skirting the tax.