Some question tax credits for 'adversary’ to bring battery plant to Illinois

[September 21, 2023]  By Greg Bishop | The Center Square

(The Center Square) – A Chinese-linked electric vehicle battery manufacturing getting Illinois and federal tax credits to set up a facility in Kankakee County is raising red flags for some.

Earlier this month, Gov. J.B. Pritzker joined local officials in Manteno to announce the Chinese company Gotion is bringing a new factory to Illinois.

“With a $2 billion investment, Gotion intends to build a new state-of-the-art EV battery gigafactory right here in Manteno,” Pritzker said.

The announcement comes with more than half-a-billion dollars in tax credits from the state. The deal also has the local government freezing property taxes for 30 years.

“It’s just the most recent proof that we are in a new paradigm here,” Pritzker said. “Illinois is on the rise and we’re open for business.”

Wirepoints founder Mark Glennon said the $536 million in tax credits for Gotion does not include federal tax credits as part of the Inflation Reduction Act.

“Enormous credits are available and the source that we have indicates that this will come to some $6.5 billion over the first five years,” Glennon said. “Six-and-a-half billion for a plant that’s only going to cost $2 billion to build.”

Others have raised concerns around the company’s ties to the Chinese government, which is considered an adversary to the United States.

Several Illinois House Republicans said they would have never voted for the Reinventing Electric Vehicles state tax credit if they knew it would be used to give more than half-a-billion in tax incentives to a Chinese-linked company.

State Rep. Chris Miller, R-Oakland, said Illinois tax incentives should not go to people who “spy on our country, steal our technology, and intend to drive American companies out of business.”

Illinois Gov. J.B. Pritzker (center) with others during an event in Kankakee County Friday
Facebook / Governor JB Pritzker

“Pritzker’s giveaway borders on being traitorous,” Miller said.

Along with other Republicans, Miller plans legislation to revise the state’s REV tax credit to require any future incentives for foreign entities to only go to those affiliated with allied countries of the United States.

A planned Gotion plant in Michigan is anticipated to garner $1.4 billion in taxpayer incentives. The proposed facility has drawn public opposition from Mecosta County residents. Some residents expressed environmental concerns whereas others said they oppose the company’s connection to China.

In a letter the U.S. House Select Committee on the CCP sent to Treasury Secretary Janet Yellen last week, committee leaders implored her to withhold any federal support for Chinese battery companies in the U.S., including the Michigan facility.

"Gotion High-Tech Co. is a [People’s Republic of China] company that has direct ties to the CCP and state-owned financial institutions. Gotion has been an active participant in the PRC-based version of the ‘Thousands Talents Program’ a program the FBI itself says encourages theft of trade secrets and economic espionage,” the letter said. “Gotion has established multiple ‘Communist Party Units’ within its operations and has publicly sought PRC provincial government support for its desire to expand its operations overseas.”

The committee also said even more worrisome is the U.S. Treasury may be offering Gotion large government subsidies for the project.