Illinois ends state grocery tax Jan 1 — but local taxes are coming
Effective January 1, 2026, Illinois will eliminate its 1% state sales tax on food for human consumption. But the door is open for local governments to charge their own 1% grocery tax — and many plan to.
Written by Alex Lamachenka
Head of DemandGen
Published
TL;DR
- Illinois ends 1% state grocery tax on Jan 1, 2026
- Local grocery taxes may take effect Jan 1 or July 1
- Soda, candy, alcohol, and prepared foods still taxable
- Some regional transit district taxes will remain unchanged
What’s changing
- State-level repeal: 1% grocery tax ends Jan 1, 2026
- Local opt-in: Counties/municipalities may impose 1% local tax
- Ordinance deadlines:
- Filed by Oct 1, 2025 → local tax starts Jan 1, 2026
- Filed by Apr 1, 2026 → local tax starts July 1, 2026
- Scope: Applies only to food for human consumption
- Exclusions: Candy, soda, alcohol, cannabis, and hot/prepared foods
Who this affects
- Grocery stores, bodegas, and meal kit sellers with Illinois customers
- Retailers with in-store or delivery operations in Illinois municipalities
- Tax teams needing to track variable local food tax rates by jurisdiction
- Platforms with Illinois-based merchants selling food
Why this matters
This change removes a flat state grocery tax but replaces it with the potential for hundreds of local tax configurations. Sellers won’t just need to update rate tables once — they’ll need to monitor where and when local grocery taxes apply.
If you sell food in Illinois, expect the map to get messier — and make sure your POS or tax engine is ready for county-level complexity.
Next steps
- Confirm if you sell grocery items to Illinois customers
- Monitor local tax adoptions starting Jan 1 and July 1, 2026
- Use automated software like TaxCloud to track rate changes at the county and city level
Other US Sales Tax Updates
Yakima County sales tax increases starting January 1, 2026
Yakima County is increasing local sales and use tax to fund emergency communication systems. Sellers must apply new rates at the city and county level beginning in January 2026.
City of Gunnison shifts sales tax collection to the state starting in 2026
Starting January 1, 2026, the City of Gunnison will stop self-collecting local sales tax and move to state-collected city sales tax through the Colorado Department of Revenue.
Washington, D.C. raises sales tax rate on goods and services
Washington, D.C. is raising its sales tax rate from 6% to 6.5% soon on tangible goods and a wide list of taxable services (like data processing, information services, landscaping, and health clubs). If you sell into the District, this means higher effective costs for customers today—and another jump to 7% is coming in 2026.