Chicago Sun-Times Quotes Tax Foundation in Article on Chicago Sales Tax

"Quarter cent tax cut, but sales tax still highest in Chicago"

By Lisa Donovan

Starting Sunday, the next time you dine out or buy a big screen television in the Chicago area you should find a little extra change in your pocket.

That's because the dawn of the New Year means Cook County's sales tax falls a quarter cent. In most parts of Chicago, the combined city, county and state sales tax rate falls from 9.75 percent to 9.5 percent on all retail purchases except groceries.

Likewise, taxes on a restaurant tab will fall a quarter cent but will vary depending where you dine out. Restaurants inside a special taxing district that includes downtown Chicago will see taxes fall from 11 percent to 10.75 percent, for example.

But don't get too excited: Chicago retains the dubious distinction of having the highest sales tax rate of any big city in the nation. In second place is Phoenix, followed by New York City, according to the Chicagoland Chamber of Commerce.

...

"Basic economics teaches us that if you lower the price of doing something, people will do more of it," Scott W. Drenkard, an analyst with the independent Washington, D.C.-based Tax Foundation, wrote in an email to the Sun-Times.

"While Cook County may have a ways to go before it is competitive with its neighbors in Wisconsin, this is a step in the right direction."

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