Chicago officials propose 1% grocery tax amid city’s billion-dollar deficit
Chicago Mayor Brandon Johnson and his budget team are advocating for the implementation of a 1% grocery tax, positioning it as a vital step in addressing the city’s looming financial crisis. The proposal comes as the current state-level grocery tax is set to expire in 2026, creating a potential shortfall of up to $80 million in the next fiscal year. Without a replacement, essential services such as public safety would face significant cuts, prompting urgency in the city council to act before the October 1 deadline to maintain revenue continuity.
During a meeting with the Committee on Finance: Subcommittee on Revenue, Budget Director Annette Guzman emphasized the importance of the new tax in averting a deficit and preserving critical programs. She highlighted that over 200 Illinois municipalities have already taken similar measures to extend the grocery tax, underscoring the necessity for Chicago to follow suit. Guzman noted the reliance of the city’s police department on the corporate fund, warning that without new revenue, staffing, training, and community-based initiatives could be jeopardized.
Johnson’s approach has been framed as a way to maintain existing revenue streams rather than impose new taxes, though the proposal has sparked debates within the city council. Alderman Andre Vasquez criticized the absence of the tax in the 2025 budget, which he believes could have eased the legislative process. Despite these challenges, the City Council Office of Financial Analysis cautions that any new tax would not become effective until mid-2026, creating a narrow window for action as the city strives to prevent a deepening financial crisis.