CME's Duffy takes on possible transaction tax

CME Group Executive Chairman and President Terry Duffy appeared before the Illinois House Revenue and Finance Committee Thursday to discuss how imposing a proposed tax on financial transactions would harm Illinois consumers, agricultural producers, businesses and the state economy.

"Imposing a financial transaction tax will not alleviate the state's budget crisis, and instead would have a negative impact on consumers because the cost of hedging their business risks would go up as much as 800 percent," said Duffy. "If enacted, every business that uses any risk management tools would face higher costs as bid/ask spreads widen. Farmers, ranchers and other businesses in Illinois and all over the country would be forced to pass along those costs to consumers, who would pay more for food, gas, airline tickets and other products."

"Additionally, a transaction tax would put the largest exchange in the U.S., which is headquartered in Illinois, at a competitive disadvantage in the global marketplace."

The hearing was held at 10:00 a.m. CT in the Capitol Building in Springfield, Ill. Duffy's testimony will be.

Text of Duffy Testimony