I thought I had heard it all in politics but the proposed tax on satellite TV service to fund blackmail, I mean incentive packages to corporations, is the most blatant and shameless move I've ever seen in the state of Illinois. Yeah, it's that bad considering how messed up Illinois is.
A new 5% tax would be slapped on satellite providers and undoubtedly passed on to susbsribers, amounting to $75 million dollars a year in revenue. This money would then be dispersed to ADM, Univar (never heard of them but they are in the chemical distribution business), and recently merged OfficeMax and Office Depot. The incentives are meant to keep their corporate headquarters in Illinois – near or in Chicago, more precisely. ADM would also be required to add 100 jobs every year for the next five years in Decatur, Illinois. ADM's global headquarters are currently in Decatur but ADM would like to move its highest positions to Chicago, presumably as long as they get the state to agree to incentives.
I find it highly unlikely that ADM would agree to add jobs to its Decatur facility if they hadn’t already been planning to do so. How else could they promise such a thing? Magic?
“For too many years, the middle class' wages have been stagnant while corporate profits grow, and at the same time corporate profits have increased, cities and other regions have been asked to subsidize economic development that probably would have occurred anyway…” – Chicago Alderman Will Burns. (http://www.progressillinois.com/quick-hits/content/2013/11/20/ald-burns-introduces-chicago-corporate-tax-disclosure-ordinance)
I find the satellite tax wrong on many levels though I won't get into all of them. One, it is essentially a tax paid directly to corporations. Taxes should go towards public projects and programs. We pay taxes for roads, schools, police protection, fire protection, environmental protection, dams, waterway improvements, social safety nets, etc. We don't pay taxes to support blackmail funds for every whiny, demanding business threatening to leave the state.
Another issue is that as state pensions are being slashed for lack of proper funding, the state can still find ways to give free money to profitable billionaire corporations, by taking it out of the pockets of the middle-class and the poor. If that isn't wrong, I don't know what is. It's out of the realm of common sense.
And do Illinois' corporations pay overly burdensome tax rates to the state? Hardly.
The public, including lawmakers, are largely left out of the loop when it comes to the details surrounding big companies' corporate income tax liabilities in Illinois. But what is known is that two-thirds of Illinois corporations reportedly pay no corporate income tax to the state, according to the Illinois Department of Revenue's 2010 Annual Report. (http://www.progressillinois.com/quick-hits/content/2013/11/20/ald-burns-introduces-chicago-corporate-tax-disclosure-ordinance)
Another highly questionable incentive is the practice of corporations getting to keep some taxes that are withheld out of their employees' checks. This is meant as an incentive to hire more people but something else is happening. Essentially corporations get a to collect a tax from their employees. I would call that taxation without representation.
Under these deals, the company gets to keep a portion of employee tax withholdings it would otherwise forward to the state. Effectively, the state is giving money to an entity that doesn't owe any taxes. It's kind of like an earned income tax credit for corporations, except these companies aren't near poverty. (http://www.chicagobusiness.com/article/20131108/BLOGS10/131109861/heres-the-bigger-risk-for-companies-demanding-tax-breaks#)
The best incentives that the state could give to business are a balanced budget, a modern infrastructure, good schools, and fair tax rates for all. That means no loopholes, no sleazy incentives, and no favoritism.
I am encouraging our lawmakers to end these games. Just stop. It's not even funny anymore. Grown a brain. Seriously.