Walmart’s Move Sparks Sales Tax Rate Increase
- Sales Tax Rate Changes
- Mar 24, 2016 | Gail Cole
While consumers may appreciate the presence of big box stores like Walmart because they make it easy to shop, local governments usually appreciate them for the tax revenue they generate. When stores decamp, their old hometowns need to cope by either making do with less or somehow recouping the lost revenue.
As the East Dundee, Illinois, Walmart prepares to move operations to neighboring Carpentersville, East Dundee officials have been deciding whether or not to increase the local sales tax rate by 0.5%.
Home rule, adopted by East Dundee in March 2004, allows the village government to adopt any laws or forms of tax that are not specifically prohibited by state or federal laws.
The departure of Walmart (scheduled for summer 2016) is expected to reduce sales tax revenue by approximately $850,000. To offset that loss, town officials have approved the 0.5% home rule sales tax rate increase, which will bring the total rate to 9.75%.
The new rate is scheduled to take effect July 1, 2016.
Every time local sales tax rates change, businesses selling in those jurisdictions need to update their systems. Sales tax software facilitates the process. Learn how it works.