New Illinois law will ensure online sales tax compliance

Local News

SPRINGFIELD, Ill. (WTVO) — Some sales tax revenue from people shopping online is slipping through the cracks, according to Illinois lawmakers, who hope to remedy that with legislation passed Thursday.

Starting January 2021, locally-imposed sales taxes will apply to all online sales, from remote sellers or third party marketplaces.

That means products purchased online and shipped to Illinois addresses will generate the same tax revenue as products purchased locally.

Now, a group representing retail shops predicts an online sales tax will bring in an extra $380 million for the State, and another $85 million for local governments.

“Sales tax is the number one revenue for most local units of government in Illinois. They have seen that bleed away, right, because there has been no mechanism for collecting that tax. Now, thanks to the Supreme Court’s Wayfair decision, there is a mechanism for doing that. And that’s what we put into law,” said Rob Karr, of the Illinois Retail Merchants Association.

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