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City Losing Revenue As Loophole Lets Companies Go To Low-Tax Towns

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Photo Of $20 And $10 Bills. (AP Photo)

Photo Of $20 And $10 Bills. (AP Photo)

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CHICAGO (CBS) — More and more companies are finding a loophole, out of the high sales tax in some counties, but Chicago officials may try to put a stop to that.

As WBBM Newsradio’s Michele Fiore reports, with Chicago’s 9.75 percent sales tax, some businesses, such as those with catalog houses, appliance retailers and even oil companies, are setting up offices in places with lower sales tax.

LISTEN: WBBM Newsradio’s Michele Fiore reports


Aamong those places are Channahon, and Kankakee, where the sales tax is the Illinois state minimum of 6.25 percent.

Chicago’s rate is 9.75 percent.

The Chicago Tribune reports Chicago and its immediate suburbs are losing millions of dollars in revenue as a result.

“There is money that should be going to Chicago that is going to other cities,” said Chris Mather, a spokesman for Chicago Mayor Rahm Emanuel, whose office said it would sue Channahon and Kankakee this coming week.

Illinois is among a few states that apply sales tax where an offer is accepted rather than where a product is delivered to a customer.

(TM and © Copyright 2011 CBS Radio Inc. and its relevant subsidiaries. CBS Radio and EYE Logo TM and Copyright 2011 CBS Broadcasting Inc. Used under license. All Rights Reserved. This material may not be published, broadcast, rewritten or redistributed. The Associated Press contributed to this report.)

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