Illinois bids adieu to its grocery tax in 2026

Illinois Gov. JB Pritzker signed off on Illinois’ elimination of a 1% grocery tax starting in 2026, reports CBS News. 

The legislation was approved by the Illinois General Assembly in May after Pritzker proposed the grocery tax deletion as part of his 2025 budget plan. 

“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.”

Thirteen states, including Illinois, currently have a grocery tax. 

However, the move to eliminate it has not gone over well with towns and cities in Illinois, which depend on the grocery tax for operating revenue. 

Chicago stands to lose an estimated $60 million to $80 million in tax revenue once the tax cut is in effect. Rockford would lose $7 million to $8 million, and Peoria about $4 million. 

In January of this year, a bill was being considered by the Tennessee state legislature that would abolish the grocery tax, but it did not make it out of committee. 

Oklahoma eliminated its 4.5% statewide grocery tax in early March.