Facing a $1 billion-plus budget shortfall, Chicago’s “progressive” Democrat Mayor Brandon Johnson is pushing for a new 1% grocery tax.
The move is sparking backlash from residents already burdened by high prices and taxes.
The proposed tax would replace Illinois’ expiring grocery tax, which ends on January 1, 2026.
Johnson is calling on the City Council to enact a local version by October 1 to avoid a lapse in revenue.
Budget Director Annette Guzman defended the proposal before the City Council’s Finance Subcommittee on Revenue.
Guzman is warning that letting the tax expire could cost the city $80 million next year alone:
“Allowing that tax to lapse in 2026 would cost the corporate fund an estimated $80 million next year alone, further exacerbating our $1 billion-plus gap.
“Nearly 200 other municipalities in Illinois — from Berwyn to Wheaton and beyond — have already voted to extend this grocery tax…
“If we fail to do the same, we will leave critical services on the chopping block.”
Guzman specifically cited the Chicago Police Department as a likely target for cuts if the tax isn’t passed:
“Roughly one-third of our corporate fund supports the police department and its related pension obligations.
“Without new revenue, staffing, training, and community-based programs could face cuts.”
Despite public frustration, Johnson argued in a Tuesday press conference that the city is not introducing additional taxes, just collecting one that previously flowed to the state:
“The City of Chicago will not enact its own grocery tax.
“The grocery tax already exists.
“There is a process in which the collection of the grocery tax is now being placed in the responsibility of municipalities…
“We’re not creating a grocery tax.
“We’re just creating a process by which we can collect it.”
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However, Alderman Andre Vasquez criticized the mayor’s budget team for not including the tax in the 2025 budget, which may delay implementation even if it passes:
“Had it been included in the budget, it might have gotten done in a way that’s going to feel a lot easier than this year.
“Hearing that 200 municipalities that already did it — it’s a bit frustrating.
“It was a missed opportunity.”
The City Council Office of Financial Analysis confirmed that even if passed, any new grocery tax wouldn’t begin collecting revenue until mid-2026, due to procedural delays.
As families across Chicago struggle with inflation and a rising cost of living, the Johnson administration faces an uphill battle justifying a tax on groceries — a basic necessity — in the name of closing a billion-dollar budget gap.
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