Oswego Shoppers Might Not See Relief After Illinois Grocery Sales Tax Is Eliminated

OSWEGO, IL — On the heels of Illinois eliminating its grocery tax, Oswego is considering implementing its own tax to maintain its revenue base, according to village documents.

The 1 percent grocery tax in Illinois will be eliminated starting Jan. 1, 2026. The village collected just over $913,000 in the "food" tax category in 2023 and estimates it received between $1 million and $1.25 million in grocery tax revenue in 2024, according to village documents.

Neighboring towns are considering a similar path. At a recent Will County Governmental League meeting, an "overwhelming majority" of the more than 25 municipalities present indicated they planned to pass a grocery tax in tandem in June or July. The Village of Montgomery unanimously approved a 1 percent local grocery tax at its April 14 meeting, and Yorkville passed one on April 22.

Municipalities that plan to implement their own local grocery tax at the time Illinois' ends have to adopt an ordinance before Oct. 1.

Oswego is considering two options should the tax be passed: One would be to direct taxes collected to the General Fund or to allocate the revenue to the Water and Sewer Capital Fund. The latter would save the average resident $8.33 per month and $100 per year, documents state.

Trustee Kit Kurht formerly suggested segregating the revenue into a "permanent" fund where it would not be touched and instead allowed to grow to eventually "be substantial enough to have a meaningful offset to customers' water bills."