Will Taxes Force Caterpillar To Leave Illinois?
April 18, 2011 In January, Illinois Gov. Pat Quinn signed legislation increasing Illinois’ personal income tax from 3% to 5% and then boosting the corporate tax rate from 4.8% to 7%.
As a result, Caterpillar Chief Executive Doug Oberhelman warned Gov. Quinn that he’d been encouraged to look at relocating his company to Wisconsin, Texas, South Dakota, Nebraska and other states lining up in the wake of Illinois’ massive tax hike this year on business.
“I want to stay here,” Oberhelman wrote. “But as the leader of this business, I have to do what’s right for Caterpillar when making decisions about where to invest. The direction that this state is headed in is not favorable to business, and I’d like to work with you to change that.”
Quinn’s response shocked most, he said, “Caterpillar is not leaving Illinois. They have well-skilled workers who know how to get the job done. They just signed an agreement with the United Auto Workers, I think for six years. I don’t think we should get in a panic at all.”
The local UAW boss was appalled at Quinn’s nonchalance and told an NBC affiliate in East Peoria that Caterpillar does not bluff. “When they are talking to you, you better listen. Because if you don’t listen, bad things can happen,” said Local 974 President Dave Chapman, in authentic union vernacular.
Nebraska Gov. Dave Heineman’s spokeswoman confirmed that Nebraska was one of at least four states that contacted Caterpillar about uprooting its Peoria headquarters after Illinois increased its income tax rate in January.
(Source: USAgNet)
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