Sales tax is a tax imposed by state and local governments on the sale of goods and services and is usually calculated as a percentage of the sale price. Sales tax is sometimes referred to as retail sales tax.
In Illinois, sales tax is a combination of state, county, city, and regional transportation authority taxes. The state imposes a base sales tax rate, and local jurisdictions can add their own taxes on top of the state rate. As of the knowledge cutoff in 2023, the base state sales tax rate in Illinois is 6.25%. However, the total tax rate varies depending on the location of the sale, as local governments may impose additional taxes. Certain items, such as food, drugs, and medical appliances, may be taxed at a reduced rate. The sales tax is collected by retailers at the point of sale and remitted to the Illinois Department of Revenue. Businesses are responsible for collecting the correct amount of sales tax and for filing sales tax returns on a regular basis.