Gov. JB Pritzker signs legislation ending Illinois grocery tax in 2026
CHICAGO (CBS) -- Gov. JB Pritzker on Monday signed legislation eliminating Illinois' 1% tax on groceries starting in 2026.
Pritzker had proposed eliminating the state's 1% sales tax on groceries as part of his 2025 budget plan, saying the tax is regressive and hurts low-income Illinoisans.
The Illinois General Assembly approved the legislation to eliminate the grocery tax in May when it approved Pritzker's budget plan. With Pritzker now having signed off on the plan to eliminate the grocery tax, it will be repealed statewide on Jan. 1, 2026.
"Even with inflation cooling off, every dollar counts, so I'm proud we're doing what we can to make trips to the grocery store a little easier," Pritzker said in a statement. "It's one more important part of lifting the burden on Illinois families."
Illinois is one of only 13 states that has a sales tax on groceries. Getting rid of the grocery tax might make a trip to the supermarket more affordable, but some local governments have said it will also blow a hole in their budgets, since the revenue goes to local governments and not the state.
North suburban Libertyville Mayor Donna Johnson and Algonquin Village President Debby Sosine were among two suburban leaders who have said the grocery tax keeps their communities running, by funding vital services like police, fire and public works.
Johnson said earlier this year that the $850,000 her village receives via the tax revenue "is significant" for a community of about 20,000 residents.
Sosine said in May that eliminating the grocery tax would cost Algonquin about $2 million in annual tax revenue, adding that the village "very much" relies on that tax revenue to balance its budget each year.
"How are we going to make up this $2 million deficit in our budget?" Sosine said.
While the state will eliminate the grocery tax beginning in 2026, local governments will have the option to reinstate the tax at the local level without asking voters.
Johnson said Libertyville plans on keeping the tax in place.
"While we welcome some options, we really don't like that we are being positioned as the villains by reinstating it when the governor of the state eliminated it," Johnson said earlier this year.
Sosine said in May that all options were still on the table for Algonquin.