The City of St. Charles Home Rule Sales Tax on “General Merchandise” will increase from 1.0% to 1.5% effective July 1, 2023. The .5% increase, or 50 cents on $100, will provide a consistent, dedicated revenue stream to fund ongoing improvements to City roads and related infrastructure. This sets the new total General Merchandise rate for the City at 8.5%.
This is the first increase to St. Charles’ Home Rule Sales Tax since 2004. The new rate was approved by the City Council in February 2023. Retailers and businesses with jurisdiction within the City of St. Charles should ensure their systems are updated to collect and remit the updated rate before July 1.
Not all retail sales of goods are affected by the new tax rate. Some goods are taxed at overall lower rates and are not considered general merchandise. These include:
- Food not prepared for immediate consumption, such as most food sold at grocery stores
- Prescription drugs and other nonprescription items, such as aspirin, cold medicine, etc.
- Medical appliances
- Vehicles requiring a registration/title
“We hear from residents that improving City streets is a priority,” said City Administrator Heather McGuire. “Creating a consistent revenue stream will help sustain a more effective maintenance and improvement schedule for streets and related infrastructure. It is estimated that a majority of general merchandise sales taxes are paid by non-residents. Sharing the cost of street improvements in this way is appropriate since residents and non-residents alike use the streets.”
For more information, businesses should contact the contact the Illinois Department of Revenue at 217.782.3336 or read the Informational Bulletin FY 2023-20 on the IDOR website.