Sales Taxes

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Sales tax is imposed on a seller’s receipts from sales of tangible personal property for use or consumption. If the seller (typically an out-of-state business, such as a catalog company or a retailer making sales on the Internet) does not charge Illinois Sales Tax, the purchaser must pay the tax directly to the department. Illinois Sales Tax has three rate structures – one for qualifying food, drugs and medical appliances; one for items required to be titled or registered and another for all other general merchandise.

Qualifying food applies to food not prepared by the retailer for immediate consumption, such as grocery store food items. “Qualifying food, drugs and medical appliances” include:

• food that has not been prepared for immediate consumption, such as most food sold at grocery stores, excluding hot foods, alcoholic beverages and soft drinks;
• prescription medicines and nonprescription items claimed to have medicinal value, such as aspirin, cough medicine, medicated hand lotion and fluoride toothpaste; and  
• prescription and nonprescription medical appliances that directly replace a malfunctioning part of the human body, such as corrective eyewear, contact lenses, prostheses, insulin syringes and dentures.

Vehicles include:

• motor vehicles, ATVs, watercraft, aircraft, trailers and mobile homes; and
• motor vehicles, aircraft and vessels owned by a business when that business moves into or relocates to Illinois.

Other general merchandise includes sales of most tangible personal property including sales of soft drinks, prepared food such as food purchased at a restaurant, photo processing (getting pictures developed), prewritten and “canned” computer software, prepaid telephone calling cards and other prepaid telephone calling arrangements, repair parts and other items transferred or sold in conjunction with providing a service under certain circumstances based on the actual selling price.  

Tax rates – The fundamental rate for:

• qualifying food, drugs and medical appliances is 1 percent.
• items required to be titled or registered is 6.25 percent.
• other general merchandise is 6.25 percent

The sales taxes for Bloomington and Normal are as follows:

General Merchandise                           Food/Drugs                                 Vehicles

          7.50 %                                         1.00 %                                     6.25 %

The State of Illinois general merchandise tax rate is 6.25%. Bloomington and Normal each have an additional 1.25% home rule sales tax rate. McLean County does not have an additional sales tax rate but has the authority to enact one if it so chooses. (Current as of 7/1/06)

SOURCE: Illinois Department of Revenue; http://www.revenue.state.il.us