Get rid of Illinois’ grocery sales tax to help low-income households

“Everything is expensive right now,” my neighbor complained to me the other day, and I agree. From gas, to clothes, to cars, to groceries; it feels like we’re now paying a premium for everything.

Starting on July 1, Illinois suspended its 1% grocery tax for a year to help residents handle the increasing prices we’re seeing nationwide due to the pandemic and supply chain crisis. But my question is, why not eliminate this 1% grocery tax altogether? Why are we paying a tax on groceries at all?

Illinois is currently only one of 13 states that still impose a grocery tax. Research shows that states with grocery taxes have higher food insecurity and that these taxes negatively affect both obesity and diabetes.

Grocery taxes are especially problematic for low-income households. They perpetuate health and income inequities, and therefore, perpetuate systemic racism. Regressive taxes, like the grocery tax, have a bigger impact on Black, Indigenous and people of color households, since they experience higher tax rates compared to white households while simultaneously experiencing unfair barriers to building wealth.

The grocery tax places an unfair burden on low-income households — even more so on low-income BIPOC households — which spend a greater proportion of their income on groceries compared to those with higher incomes.

For example, in a report from the Center for Budget and Policy Priorities, the analysts noted that for low-income households, groceries are the third-highest expenditure category after housing and transportation — but for households with higher incomes, groceries are only the fifth-highest expenditure category. Further, these lower-income households pay almost eight times more of their income in sales taxes than the top 1% of households.

As a result, low-income households must be strategic with their grocery budget, which means that these families more often end up eating less healthy but more inexpensive foods, such as highly processed foods, rather than perishable and healthful foods like fresh produce.

This lower-quality diet eventually leads to worse health outcomes, such as cardiovascular disease, obesity, Type 2 diabetes, and some cancers.

Government assistance doesn’t help

The second issue for low-income households is that government programs do not fully cover statewide grocery taxes for all grocery purchases. Enrolling in the Supplemental Nutrition Assistance Program (SNAP, previously known as food stamps) supports low-income households in purchasing groceries, and federal law exempts some grocery purchases made with SNAP benefits from sales tax.

But SNAP benefits are not intended to cover an entire grocery bill. Participants must still pay a grocery tax for those items not covered by SNAP. Therefore, while SNAP undoubtedly decreases food insecurity in some low-income households, it does not directly address the problem of the grocery tax head-on.

How can Illinois, in good conscience, compound income and health inequities further by requiring low-income households to pay a grocery tax? Households that are already burdened with the increasing costs of other necessities, such as housing, do not need this added stressor.

Those in favor of the grocery tax may argue that the money can be put towards public investments, such as fire departments or public transportation, but this can be achieved in ways that do not exacerbate inequities. For example, Illinois could expand taxes on profitable corporations, or reconsider the soda tax and use those funds for public investments.

Illinois doesn’t need a grocery tax. What our state needs is to start taking an active role in eradicating health, income, and racial inequities in Illinois by eliminating a regressive tax that harms our most vulnerable communities. 

Jen Sanchez-Flack, Ph.D., MPH, a behavioral scientist and health inequities researcher, is assistant professor at the University of Illinois at Chicago. She serves as a Healthy Policy Ambassador for Child Nutrition for the Society of Behavioral Medicine. 

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