Stop Illinois from Imposing America’s Highest Service Tax

Illinois is already number one in property, cell phone, gasoline, and other taxes

Sign The Letter

Dear Official(s),

Illinois families and employers are already carrying America's heaviest state-and-local tax load. A recent WalletHub analysis found that 16.51 percent of an average household’s income disappears into Illinois taxes— the highest combined burden in the nation. Our residents also pay the top wireless taxes, the second-highest property and gasoline taxes, the second-highest corporate income-tax rate, and a statewide-plus-local sales-tax average that ranks seventh.
This litany of “firsts” and “seconds” explains why more than half of Illinois voters say they would leave the state if given the chance, citing taxes as their number-one reason.
Yet again, Springfield’s instinct is not reform but another tax hike—this time a sweeping new sales tax on services advanced to rescue the Regional Transportation Authority (RTA) from a projected $770 million fiscal cliff of their own making.
The draft plan would:
- Extend the state sales tax to virtually every major consumer and business service at 6.25 percent, making Illinois’ rate the highest of any state that taxes services so broadly (West Virginia’s is 6.0 percent).
- Layer on a 1.25 percent RTA surcharge, plus whatever additional municipal or county add-ons local governments impose.
The proposal would enshrine Illinois as #1 in service-tax burden and cement our overall #1 position in total taxes.
On behalf of taxpayers across Illinois, we respectfully urge you to reject any legislation that imposes a statewide services tax or authorizes an RTA services-tax surcharge. Illinoisans cannot afford to become #1 in yet another tax category simply to cover up overspending problems that should be addressed directly.
Illinois families and employers are already carrying America's heaviest state-and-local tax load. A recent WalletHub analysis found that 16.51 percent of an average household’s income disappears into Illinois taxes— the highest combined burden in the nation. Our residents also pay the top wireless taxes, the second-highest property and gasoline taxes, the second-highest corporate income-tax rate, and a statewide-plus-local sales-tax average that ranks seventh.

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The pending legislation would slap the full 6.25 % (plus local add-ons) on more than 80 distinct service categories, from barber shops and dry cleaners to Software-as-a-Service subscriptions and janitorial contracts. A non-exhaustive list includes:

Aircraft lease or rental (≤ 60 days)
Alteration and garment repair
Armored-car services
Bank & financial-service charges
Barber and beauty services
Battery, tire, and allied services
Boat, camera, and furniture repair
Campgrounds and golf-course dues
Carpentry, plumbing, electrical, and HVAC labor
Communication and telecommunication services
Dance, dating, and massage services
Dry cleaning and laundry services
Employment and executive search fees
Extermination, landscaping, lawn care, and tree removal
Information and software services, including SaaS
Janitorial and building maintenance
Motor-vehicle, RV, boat, bicycle, and motorcycle repairs or rentals
Parking, towing, and personal transportation (ride-share, limousine, etc.)
Pet grooming and veterinary services (non-medical)
Photography, video-game tournaments, and streaming/pay-TV
Security, detective, and armored-car services
Swimming pool and household-appliance maintenance
Welding, pipe fitting, well-drilling repair, and more.

This is not modernization; it is a shotgun blast that would raise everyday costs for families and pile untaxed inputs onto Illinois-based manufacturers and professional firms—costs our competitors in neighboring states will not face.

Extending the sales tax to 80-plus routine services would immediately raise household costs, inflate business production expenses, and force thousands of small firms to take on complex new compliance burdens. Those higher prices and administrative headaches would only hasten the ongoing flight of residents and investment from Illinois.