Illinois has the highest combined sales tax rate of any major US city — Chicago hits 10.25%, making it the most expensive city for shopping among large metro areas. The state eliminated its 1% state grocery tax in 2026, but Chicago's 10.25% still applies to many food purchases. Illinois has complex origin-based vs destination-based sourcing rules for online sales.
Illinois sales tax overview
| Component | 2026 Rate |
|---|---|
| State sales tax | 6.25% |
| Avg local add-on | 2.57% |
| Avg combined | 8.82% |
| Maximum combined | 11.50% |
Note: Illinois eliminated its 1% state grocery tax in 2026; some local jurisdictions reinstated their own. Chicago's 10.25% is the highest combined rate in any major US city.
Illinois sales tax by city
Combined state + local sales tax rates for major cities in Illinois:
| City | Combined Rate |
|---|---|
| Chicago | 10.25% |
| Aurora | 8.25% |
| Naperville | 7.75% |
| Joliet | 8.50% |
What's exempt in Illinois
Groceries
Reduced state rate: 0.000% (vs. 6.25% general). Local rates may still apply.
Clothing & footwear
Taxed at standard rate.
Prescription drugs
Subject to standard sales tax.
How Illinois sales tax is calculated
Sales tax in Illinois is calculated by multiplying the pre-tax purchase price by the applicable combined rate. The formula is simple:
Sales Tax = Purchase Price × 8.82% (avg combined)
Total = Purchase Price + Sales Tax
The exact rate depends on where the purchase occurs — the state base rate (6.25%) plus any local city or county add-ons. Illinois allows local jurisdictions to add their own taxes, so the rate varies by location.
Quick calculation examples at average rate 8.82%:
$100 item
$8.82 tax
$108.82 total
$250 item
$22.05 tax
$272.05 total
$500 item
$44.10 tax
$544.10 total
$1,000 item
$88.20 tax
$1088.20 total
Additional tax-free items in Illinois
Beyond the standard exemptions, Illinois also provides sales tax relief on these categories:
Exemptions may have conditions. Always verify with the Illinois Department of Revenue for complete rules.
Illinois sales tax in context: rates, history, and neighbors
Illinois's 6.25% state sales tax (since 1990) plus aggressive local taxation creates the highest combined rate of any major US city — Chicago hits 10.25% (6.25% state + 1.75% Cook County + 1.25% city + 1% MPEA + smaller). Aurora 8.25%, Naperville 7.75%, Rockford 8.75%. Illinois eliminated its 1% state grocery sales tax effective January 2026 — but Chicago and some localities reinstated their own grocery taxes, so net relief varies by location. The dual sales tax / use tax structure (with different sourcing rules — origin vs destination) creates compliance complexity for businesses. Compared to neighbors: Indiana (7%), Iowa (~6.94% combined), Wisconsin (~5.44%), Missouri (~8.42%), Kentucky (6%) — Illinois's combined rate is high, particularly Chicago. The state's heavy reliance on sales tax for revenue (combined with property tax) is a major political issue.
Online shopping & Illinois sales tax
Illinois uses a hybrid origin/destination sourcing system that complicates online sales. Remote sellers with $100,000+ or 200+ Illinois transactions must collect Illinois use tax. Notably, Illinois has both a Use Tax (for remote sales) and a Retailers' Occupation Tax (for in-state sales) — at the same rates but with different sourcing rules. Sellers must use destination-based sourcing for Use Tax.
Use Tax reminder: If you purchase taxable goods online from a seller who does NOT collect Illinois sales tax, you technically owe Use Tax — the same rate as sales tax, reportable on your Illinois state tax return. Use Tax enforcement on consumers is rare but the obligation exists for significant purchases.
How much Illinois sales tax on common purchases?
Using Illinois's average combined rate of 8.82%:
| Purchase | Price | Sales Tax | Total |
|---|---|---|---|
| Grocery cart | $150 | $3.85 | $153.85 |
| Clothing / shoes | $120 | $10.58 | $130.58 |
| Prescription drug | $80 | Exempt | $80.00 |
| Smartphone | $999 | $88.11 | $1087.11 |
| Laptop / tablet | $1,299 | $114.57 | $1413.57 |
| New car ($35,000) | $35,000 | $3087.00 | $38087.00 |
| Home appliance | $1,500 | $132.30 | $1632.30 |
| Restaurant meal | $60 | $5.29 | $65.29 |
Based on Illinois's average combined rate of 8.82%. Exact tax depends on city/county. Use our calculator above for specific locations and amounts.
Collecting sales tax in Illinois: business guide
If you sell goods or taxable services to Illinois customers, here's what you need to know:
- Registration: Register for a Illinois sales tax permit/license through the Illinois Department of Revenue before making your first taxable sale. Most states process registrations online within a few days.
- Economic nexus (online sellers): If you have $100,000+ in Illinois annual sales or 200+ transactions, you must collect Illinois sales tax even without a physical presence in the state — per South Dakota v. Wayfair (2018). You must collect both state (6.25%) and applicable local rates.
- Destination vs origin sourcing: Illinois uses destination-based sourcing for most sales — the tax rate where the buyer receives the goods applies. Always use the customer's delivery address to determine the rate.
- Filing frequency: Frequency depends on your Illinois sales volume — monthly for high-volume sellers, quarterly or annually for low-volume sellers. Check with the Illinois Department of Revenue for your specific filing schedule.
- Marketplace sales: If you sell through Amazon, Etsy, eBay, or similar platforms, the marketplace is required to collect and remit Illinois sales tax on your behalf — you don't need to collect it separately on marketplace transactions.
- Resale certificates: Businesses purchasing goods for resale can provide a Illinois resale certificate to suppliers to avoid paying sales tax on wholesale purchases. Keep copies of all resale certificates for audits.
Streamlined Sales Tax (SST): Illinois is not currently a member of the Streamlined Sales Tax (SST) Agreement — check Illinois Department of Revenue for filing specifics.
Illinois-specific business compliance details
Illinois businesses register with the Illinois Department of Revenue (IDOR) at mytax.illinois.gov for an Illinois Business Tax Number. Filing frequency: monthly for $200+/month tax, quarterly for $50-$200, annually for under $50. Illinois has a unique dual structure: in-state sellers pay Retailers' Occupation Tax (ROT — origin-based for in-state), while remote/out-of-state sellers pay Use Tax (destination-based). Out-of-state sellers with $100,000+ in Illinois sales (or 200+ transactions) must collect Use Tax (since 2018). Marketplace facilitators collect on third-party sales. Chicago has additional local tax compliance (city Home Rule sales tax administration). Penalties: late filing 2% (capped at $250) + 0.5% per month interest. Illinois sales tax compliance for multi-jurisdiction sellers often requires specialized software.
Illinois sales tax frequently asked questions
What makes Chicago's 10.25% sales tax the highest of any major US city?
Chicago's 10.25% reflects stacked taxes from multiple jurisdictions: 6.25% Illinois state + 1.75% Cook County + 1.25% City of Chicago + 1% Metropolitan Pier and Exposition Authority (MPEA). Additional special district taxes apply in certain areas. On top of this, restaurant meals face an additional 0.5–1% amusement tax, and parking can hit 26%. The combination makes Chicago one of the most tax-heavy shopping destinations in the country.
How does Illinois's grocery tax work in 2026?
Illinois eliminated its 1% state sales tax on groceries in 2026, making most unprepared grocery items state-tax-free. However, Chicago and some localities enacted their own local grocery taxes to replace the lost revenue. In Chicago, grocery items may still face local taxes. Prepared food (ready-to-eat items from a restaurant or grocery store hot bar) remains taxable at full rates.
What is the Illinois Use Tax and when does it apply?
Illinois's Use Tax is the mirror of its sales tax — if you purchase a taxable item outside Illinois without paying sales tax, you owe Illinois Use Tax equal to what the sales tax would have been. This commonly applies to large online purchases from out-of-state retailers who don't collect Illinois tax, or items purchased in another state and brought home. Illinois residents report Use Tax on their state income tax return (Schedule G). The rate matches your local combined sales tax rate.
Illinois city paycheck calculators
If you live or work in a Illinois city, see our city-specific paycheck calculators for take-home pay including any local income tax, plus local employer and cost-of-living context: