Stop Illinois from Imposing America’s Highest Service Tax

In Springfield, the go-to “solution” is always taxes—either jacking up the rates we already pay or dreaming up whole new things to tax. It’s a tired reflex that sidesteps real reform and keeps squeezing families and businesses instead of reining in runaway spending. A recent WalletHub study shows Illinois has the highest combined state and local tax burden (16.51%). 

Our various taxes consistently place us at or near the top nationwide. Below is a snapshot of key tax rates:  

Despite this dubious distinction, Springfield is trying to create an expansive new category of services taxes at the highest rate in the country. 

As of today, Illinois currently leaves the service sector virtually tax-free, except for rare exceptions for parts and materials. However, an effort to radically expand Illinois sales taxes on services has arrived in Springfield. The proposal would adopt one of the nation’s broadest services tax bases, taxing virtually every major consumer and business service at the highest statewide rate in the country.

 At the proposed 6.25 percent statewide rate, Illinois would edge past West Virginia’s 6 percent to become the highest statewide rate applied to such a broad range of services anywhere in the United States. The proposal also includes local surcharges such as a 1.25% RTA service tax. Other local surcharges, such as municipal or county taxes, could also be included.

We urge legislators to reject the push to make Illinois #1 in service Taxes—and pile onto Illinois’ #1 overall tax burden, speeding the exodus of families, jobs, and investment from our great state.

Complete list of over 80 service tax hike categories being proposed for Illinois:

• Aircraft lease or rental (≤ 60 days) 

• Alteration and garment repair 

• Armored car services 

• Bank & financial institution service charges 

• Barber and beauty services 

• Battery, tire, and allied services 

• Boat repair 

• Camera repair 

• Campgrounds 

• Carpentry repair and installation 

• Carpet, rug, and upholstery cleaning or repair 

• Communication services (excludes Internet access fees) 

• Dance schools and studios 

• Dating services 

• Demolition 

• Dry cleaning, pressing, dyeing, laundering (excludes self service laundries) 

• Electrical & electronic repair or installation 

• Employment and executive search agencies 

• Excavating and grading 

• Extermination services 

• Farm implement repair of all kinds 

• Flying service and flight instruction 

• Furniture repair and cleaning 

• Fur storage and repair 

• Garbage collection & disposal (non residential commercial) 

• Golf & country club dues and other commercial recreation fees 

• Gun repair 

• House & building moving 

• Household appliance, TV, and radio repair 

• Investment counseling 

• Information services 

• Janitorial & non residential building maintenance/cleaning 

• Jewelry and watch repair 

• Landscaping, lawn care, tree trimming & removal 

• Machine operator fees 

• Machine repair of all kinds 

• Massages (unless by a licensed massage therapist) 

• Mini storage 

• Motor repair 

• Motor vehicle, RV, and recreational boat rental (without driver) 

• Motorcycle, scooter, and bicycle repair 

• Oilers & lubricators (vehicles and machines) 

• Office & business machine repair 

• Painting, papering, interior decorating 

• Parking facilities 

• Pay television (incl. streaming, VOD, pay per view) 

• Personal transportation services 

• Pet grooming 

• Photography & photo retouching services 

• Pipe fitting 

• Plumbing (incl. drain cleaning, pipe unplugging) 

• Reflexology 

• Retouching photographs 

• Roof, shingle, and glass repair 

• Security & detective services 

• Sewage services (non residential commercial) 

• Sewing and stitching 

• Shoe repair and shoeshine 

• Sign construction and installation 

• Services related to installing/maintaining/upgrading specified digital products 

• Software as a Service (SaaS) 

• Storage warehouses/lockers for raw agricultural products 

• Storage of household goods 

• Storage of tangible or electronic files/documents/records 

• Swimming pool cleaning and maintenance 

• Tanning beds or salons 

• Taxidermy 

• Telecommunication services (excludes Internet access fees) 

• Telephone answering services 

• Testing laboratories (excludes human, animal, environmental tests) 

• Tin and sheet metal repair 

• Tree trimming and removal 

• Turkish baths & reducing salons 

• Vehicle repair 

• Vehicle wash and wax 

• Video game services and tournaments 

• Water conditioning and softening 

• Weighing 

• Welding 

• Well drilling (repair only) 

• Wood preparation (stripping, cleaning, sealing) 

• Wrapping, packing, packaging of merchandise (except processed meats/fish/fowl/vegetables) 

• Wrecker and towing