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Cook County's sales tax hike: Who really pays the price?
Cook County's tax hike: Who pays the price? Depends on where you live in Cook County and beyond.

Friday, July 17, 2015
Chicago Tribune
by Becky Yerak and Robert Channick

It's going to cost more to shop in Cook County.

The county's board last week approved a 1-percentage-point increase in the sales tax, a reversal of a reversal of the same tax a half decade or so ago, a tax that got Todd Stroger ousted as board president and saw Toni Preckwinkle installed. Now Preckwinkle and her board are going where Stroger paid the political price to tread.

In Chicago, the sales tax will rise to 10.25 percent on Jan. 1, 2016, bumping up the cost of that $1,000 appliance an extra $10.

Retailers and other business interests fear that the additional expense will drive consumers, particularly those living close to the Cook County border, to neighboring counties. At least one study backs up that notion.

A 2009 study by Joseph Schwieterman, director of Chaddick Institute for Metropolitan Development at DePaul University, found that sales tax rates affect buying behavior near the Cook County border. At the time, the average rate for Cook County, including municipal sales tax, was about 2.16 percentage points higher than in DuPage, Kane, Lake, McHenry and Will counties.

With the January increase, Cook will charge 2 percentage points more than every collar county except DuPage, where the difference will be 1.75. That figure does not include the sales tax charged by municipalities, which Schwieterman said tends to be higher in Cook County.

Schwieterman found that while 25 percent of the region's population lived in communities with tax rates of 7.75 percent or less, its members accounted for more than 28 percent of retail sales, suggesting that "relatively low-tax areas are becoming formidable competitors to higher tax areas."

The recession made it difficult to assess the impact of high sales taxes on Cook County, which was in the middle of the pack among local counties with drops in retail sales in 2008, he said.


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