Report: Kraft Foods Seeks Incentives From State

NORTHFIELD, Ill. (CBS) — Northfield-based Kraft Foods reportedly the latest company looking for a incentives from the State of Illinois.

As WBBM Newsradio’s Pat Cassidy reports, Kraft is not threatening to leave the state if it doesn’t get a tax break, like companies such as Sears Holdings Corp. and the CME Group are, according to Crain’s Chicago Business.

LISTEN: WBBM Newsradio’s Pat Cassidy reports

Actually, Kraft is splitting in two, and has already said it plans to keep its spinoff companies headquarters in the Chicago area after the split.

Kraft chief executive officer Irene Rosenfeld told Crain’s the company has been talking with Mayor Rahm Emanuel’s office about moving at least one of its headquarters downtown sometime next year.

A state Department of Commerce and Economic Opportunity spokeswoman told Crain’s that Kraft has been talking with the state, but would not elaborate or speculate on what kind of incentives the state might offer for Kraft.

While Kraft is promising to stay regardless of what happens, other companies are playing hardball.

Earlier this week, CME Group executive director Terrence Duffy warned that if the Illinois General Assembly does not move on a tax break for the firm before the Fall Veto Session ends, the company will begin exploring options for moving the Chicago Mercantile Exchange and the Chicago Board of Trade out of Illinois.

A state Senate Committee has approved a tax break for the exchanges that changes the way derivates traded online are taxed. Currently, 100 percent of online derivatives are taxed, and a pending measure sponsored by Cullerton would cut that to about 28 percent.

The companies have been threatening to leave Illinois over a hike tax hike approved this year, which jacked the corporate income tax up from 7.3 to 9.5 percent.

Duffy said in June that the firm would lose about $50 million this year from the tax hike.

Meanwhile, Sears confirmed last month that it is in discussions about two prospective sites that are not in Illinois over the corporate tax hike. Reports said the two sites are in Austin, Texas, and Columbus, Ohio.

  • Jack

    Our state law makers better wise up and give these massive companies the tax incentives needed to keep them here in Illinois. We can’t afford to lose the jobs..

  • Dylan

    Yes, we need the jobs, but these large companies are going for the juggler. Because of the poor economy, they are going to push the limits and hold, “If we don’t get what we want, we’ll move.” over our heads. Just like Sears in Hoffman Estates. Legal blackmail. ALL states should make it a law that if you move out of a suburb, city or state, that company gets charged for leaving, just like they do when you buy a house in a different suburb. They should be charged so that nothing would change ($$$) in the place that they left for two years, so I’m talking millions.

  • Jim

    The rich get richer and the poor get poorer. Thanks Mr. “nobody is going to leave because of this tax hike” Quinn!

  • JD

    Cut public aid except for the elderly and infirmed. Use the savings to keep these companies around. At least they provide jobs and tax revenue. The scammers on public aid don’t contribute anything even when they have jobs because of the earned income tax credit.

    • Ray

      Excellent suggestion, Mr. JD. You run for office on that platform and you’ve got my vote!!!

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