PEORIA, Ill. – The future of a one-percent grocery tax in the city of Peoria is on the Peoria City Council’s agenda Tuesday.
The state’s version of the tax expires January first.
The Council will decide whether to continue collecting it.
25 News reports Peoria currently gets about $5-million dollars a year from the existing grocery tax with the money going toward day-to-day operations of police, fire, public works, community development and other areas.
The City’s Finance Department says while this is a tax that already exists, resident will not be paying any additional amount of money.
It’s estimated City of Peoria residents pay one dollar for every 100 dollars spent in eligible grocery items. The individual impact depend on family size. Based on a range of monthly grocery purchases of $600 to $1200, a household would pay between $72 and $144 for the tax over a year.
The Finance Department says many neighboring communities have already implemented the grocery tax including East Peoria, Pekin and Normal.
Alternatives to the grocery tax could be to increase the home rule sales tax, property taxes or the Hotel, Restaurant and Amusement tax,
However, to make up for the lost revenue from the grocery tax the property tax levy would have to increase nearly 15 percent. HRA taxes would need to go up nearly 50 percent.
Department officials say the anticipated increase in those tax rates and the likely public sentiment against them means those options should not be strongly considered.
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