Ill. sales taxes up today

SPRINGFIELD, Ill. | Illinois consumers will pay more for toiletries, candy, soft drinks and liquor starting Tuesday as lawmakers raise cash to pay for a statewide construction program.

Most candy -- currently carrying a 1 percent sales tax -- will be taxed at 6.25 percent. And it'll be the same for shampoos and toothpaste that until now were taxed at the lower rate if shop keepers deemed they had a medicinal effect.

Bottled soft drinks with added sweetener or flavoring, such as iced tea, will be taxed more, just like cola is now. And liquor distributors will pay more for alcohol. That cost invariably will be passed on to consumers.

All told, the changes should raise about $150 million a year toward a $30 billion roads-and-schools building plan. The program also includes hundreds of millions of dollars for local pet projects of lawmakers.

Gov. Pat Quinn also approved hikes in the cost of driver's licenses and plates and OK'd video poker in places such as taverns to increase revenue -- scheduled to bring in $600 million more annually -- to pay for what officeholders said was a long-overdue plan to put people to work and improve the state's infrastructure.

"Most retailers are in a position of saying we need a capital bill, this was part of a way to get it, and so we're living with it," said David Vite of the Illinois Retail Merchants Association.

Most of the sales-tax changes attempt to streamline the system. While food and drugs have been taxed at 1 percent for the past quarter-century, some products -- a dandruff shampoo or a sensititivity-reducing toothpaste, for example -- have qualified for the lower rate, but that is changing.

"The marketing information on the outside of the box will not determine its tax rate," Illinois Revenue Department spokeswoman Susan Hofer said. "If you buy shampoo, you pay the general sales tax rate."

Lawmakers used definitions from a national sales-tax streamlining project. But that definition is still sticky when it comes to candy. Until now, candy has been taxed as food, but will go to the higher rate -- unless it has flour or needs refrigeration.

In many communities, the sales tax is higher because local governments impose their own tariff on purchases.

Liquor excise taxes will increase as well.

They equate to a 2.6-cents increase on a six-pack of beer, 13 cents on a bottle of wine, and 81 cents for a fifth of liquor.

Tax hikes

Here are key points about Illinois sales- and liquor-tax increases taking effect today:

SALES TAXES:

--Current state sales tax on general merchandise is 6.25 percent; on food and drugs, 1 percent.

--Bottled or canned beverages such as tea will be taxed at 6.25 percent, like soda pop.

--Toiletries that carry medicinal qualities, such as dandruff shampoo or toothpaste to reduce sensitivity, will be taxed at 6.25 percent, instead of the 1 percent "drug" rate.

--Candy will be taxed at 6.25 percent, unless it has flour or needs refrigeration.

LIQUOR TAXES:

--On a six-pack of beer will increase from 10.4 cents to 13 cents.

--On a bottle of wine will go from 15 cents to 28 cents.

--On a fifth of distilled spirits will increase from 90 cents to $1.71.

Source: Illinois Department of Revenue.