Hynes' plan, sponsored by Rep. Gary
Hannig, D-Litchfield, and Rep. Jack Franks, D-Woodstock, will
prohibit corporate "expatriates" from doing business with the state
and will close a loophole in the Illinois tax code that allows
corporations to shift profits to overseas tax havens to avoid paying
taxes in Illinois.
"I am heartened that the Illinois House
understands the urgency and importance of this bill," Hynes said.
"There's something fundamentally wrong when a large corporation can
earn millions in profits from its operations in this country, then
turn around and pay no taxes on those profits because it's
technically incorporated in some sun-drenched island that -- big
surprise -- has no income tax.
"The bottom line is that every
corporation should pay what it fairly owes in taxes, just as every
individual taxpayer is expected to do. When a small number of
corporations take advantage of the system, they are simply shifting
a higher tax burden onto individuals, small businesses and the
majority of corporations that don't abuse the law. Today's
[Wednesday] vote indicates that the House agrees with me that
corporate tax evaders should not be rewarded with state contracts."
"This measure simply and fairly levels
the playing field for businesses that apply for state contracts,"
Hanning added. "As we try to maintain a budget that allows us to
provide state services, we need to take steps to discourage
corporations from avoiding their fair share of taxes."
[to top of second column in
Hynes said five corporate expatriates
have benefited from state business in recent years: Accenture,
Foster Wheeler Ltd., Tyco International, Ingersoll Rand and APW
Limited. Payments to these companies have totaled close to $2
million since fiscal 2000. In addition, the Illinois State Board of
Investment has invested in at least three expatriate corporations:
Ingersoll-Rand, Tyco International and Transocean.
Hynes noted that North Carolina,
California and Montana have enacted measures similar to his plan and
that Ohio, Massachusetts, Minnesota, Pennsylvania and Texas are
considering similar measures.
is necessary, he said, because Congress has failed to act on
proposed federal legislation making corporate expatriates ineligible
for federal contracts. "The IRS estimates that corporate expatriates
siphon off at least $70 billion each year from the U.S. Treasury.
And to add insult to injury, some of these corporations are
multimillion-dollar federal government contracts. That is why we in
Illinois are taking steps to close down the tax loopholes that are
allowing them to get away with not paying their fair share," he
[News release from the office
Daniel Hynes, state