Illinois Is Getting Rid Of Their Grocery Tax But There’s A Big Loophole

Maybe your grocery visits will get less expensive.

We're all paying a lot for groceries. It's downright depressing to do our weekly grocery trips these days. So it sounds good to get rid of a 1% sales tax on your groceries, right?

That's what Illinois is headed for, according to the state budget that was just passed in the Illinois House. It's now headed to Governor Pritzker's desk to sign off on. The governor has long been a fan of getting rid of the grocery tax. He says it's a "regressive tax" that the state doesn't need and it could help reduce inflation for families from 4% to 3%.

Why You Could Still End Up Paying It

The state's current grocery tax brings in a lot of revenue for municipalities. Keith Pekau, Mayor of Orland Park, told NBC Chicago that the cut will take $2.5 million out of the city's revenue.

That's a lot of money and these towns need ways to keep it going.

The state's budget plan allows any municipality to create it's own grocery tax of up to 1% without state oversight. So now it's not going to be the state charging you extra, but it's the town. And for those with home-rule authority, any city or county with a population of 25,000 or more can put in a 1% sales tax without having to submit it to voters for approval.

So it's going to come down to exactly where you do your grocery shopping. The state's grocery tax had been suspended 2022-2023 before it came back last summer.