SRP-IMAGE-Logo

Sales tax coming from online buying

The State of Illinois will soon be able to collect taxes on items purchased online, and that’s encouraging news for municipal leaders who have watched retail tax revenue decline in recent years.

The Illinois Supreme Court ruled 5-4 last Thursday to loosen restrictions on the state’s ability to require retailers to charge the tax.

However, the devil is in the details.

“It’s not the panacea it’s being made out to be on a local level,” said Orland Park Mayor Keith Pekau.

“It’s kind of an unknown as far as how much this is actually going to mean to individual towns,” said Palos Heights Mayor Bob Straz.

But Pekau has at least a rough idea for his town, and the outlook certainly isn’t that of a windfall.

“As near as I can tell, from the information I’ve gotten, is that it (the potential future revenue) is going to be somewhere between $140,000 and $150,000 for Orland Park, which doesn’t even come close to offsetting what we’re losing from an online sales perspective.”

Pekau, and Straz, both pointed out that it’s a “use” tax, different from a retail tax. And that means a markedly different outcome, revenue-wise, compared to the tax revenue generated by a customer making a purchase at a local, brick-and-mortar store.

“It’s got a very complicated formula for how it’s being distributed back to various municipalities,” Pekau said.

“A percentage goes to Chicago, a percentage goes to the RTA (Regional Transportation Authority) and the rest of it gets spread out by population,” Pekau said. “It’s per-capita, so every town, based on their population, gets a certain amount back.”

Amazon has been collecting tax since 2015 for purchases made in Illinois, due to its physical business presence in the state—primarily warehousing and distribution centers.

But before the Supreme Court ruling, lawmakers included language that allows the state to collect tax on purchases made from other retailers, regardless of whether the business has a location in Illinois.

“My concern going forward, now that the Supreme Court has ruled, is to make sure the state applies this as a sales tax so the municipalities can benefit as well. As currently written, the municipalities—although they’d have a very small benefit on a per-capita basis—will not have the benefit of where the sale is generated.”

Orland Park is facing a particularly sudden and steep loss of sales tax revenue this year due to the departure of several major retailers.

Toys R Us, Babies R Us, Sears, Carson Pirie Scott and Carson’s Furniture Gallery, all in Orland Square Mall, have closed or will close by this summer.

And those departures are going to hurt.

“We’re going to lose about $1.2 million in sales tax from the stores we are losing,” said Pekau in his State of The Village address in May.

But he added that because the village has healthy reserves due to conservative budgeting practices, it is in a good position to absorb the “short-term” losses.

Pekau also predicts that the vacant retail spaces will not be dark for long. Already, a cinema and retail complex is planned for the Sears site.

“The (new) law won’t take effect until October,” pointed out Straz of Palos Heights. “It’s modeled after the South Dakota law, and there’s exemptions for certain sellers.”

Among those exemptions in South Dakota are sellers who collect less than $100,000 in annual purchases. Amazon, which now collects sales tax throughout the country because of network of distribution centers, is not required to collect sales tax from third-party sellers.

Still, both mayors readily acknowledge the bright spot on the horizon, voicing a leveling of the playing field for local retail establishments.

“It’s more on a level playing field, no doubt about it,” said Straz, “and hopefully that’s why they (the Supreme Court) did it.”

Pekau said “From a mayor of a town heavily invested in retail, it’s a step in the right direction because it does start to level the playing field for our brick-and-mortar stores.”

Local News

Worth Mayor Mary Werner and Worth Police Chief Tim Denton expressed concerns over the impending no-cash bail provision of the SAFE-T Act. (File photo)

Some Worth officials are concerned about SAFE-T Act

By Joe Boyle A controversial criminal justice law that goes into effect on Jan. 1 has some Worth public officials apprehensive and believe it will actually cause an increase in crime. Worth resident Jack McGrath said that varying opinions about the Illinois Safety, Accountability, Fairness and Equity-Today Act, or the SAFE-T Act, have arrived in mailings at…

up in smoke license

Worth revokes second business license for selling illegal cigarettes

By Joe Boyle For the second time in less than a month, the Worth Village Board has voted to revoke the license of a business in which illegal cigarettes were being sold. The board accepted the recommendation of the Worth Police Department, which called for the license of Blowing Smoke II Inc., which did business as Up in Smoke, 11015 S. Harlem Ave., to be revoked.…

Pizza Castle will be moving from its longtime home in Chicago's Gage Park neighborhood to new digs in Hickory Hills.

Pizza Castle moving from Gage Park to Hickory Hills

By Bob Bong Pizza Castle has had a long run at its Gage Park neighborhood home on the Southwest Side. But after almost 50 years, the Jensen family is pulling up the roots on the family business and moving to the suburbs. The pizzeria, which was founded in 1973, will be moving to 7737 W.…

market by macy's logo

Macy’s grand opening Friday in Evergreen Park

By Bob Bong The new Market by Macy’s and Macy’s Backstage stores will hold their grand openings this weekend at Evergreen Plaza in Evergreen Park. The new stores will open in the former Carson’s at 9700 S. Western Ave. Market by Macy’s will occupy the first floor and Macy’s Backstage outlet store will take over…

Palos Heights Alderman Michael McGrogan said Tuesday that the council should come up with a solution to the proposed parking lot controversy that would satisfy businesses and residents. (Photo by Jeff Vorva )

Parking lot nixed in Palos Heights but issue not dead yet

By Jeff Vorva The controversial parking lot proposal in Palos Heights was not approved Tuesday night but the issue is not dead. The city council needed a super-majority 6-2 vote for a zoning change from residential to business and granting a special-use permit for a municipal parking lot at 12303 S. 71st Court in the…

SRP-IMAGE-Logo

Clear-Ridge Reporter and NewsHound October 5, 2022

Peggy Zabicki

Senior Center has re-opened

By Peggy Zabicki Your correspondent in West Lawn 3633 W. 60th Place • (773) 504-9327 I hope everyone has been able to enjoy the beautiful autumn weather we’ve been blessed with. I visited the Southwest Regional Senior Center, 6117 S. Kedzie, recently. They are open once again, and everything looks very nice. New floors were installed and there are freshly painted…

Mary Stanek

Tabares’ shred day was a fun event

By Mary Stanek Your correspondent in Archer Heights and West Elsdon 3808 W. 57th Place • (773) 284-7394 Happy National Pizza Month! Don’t we live in a great neighborhood for pizza? There are so many pizza parlors to choose from. There are the big chains and the mom-and-pop establishments. I volunteered on last week at…

Kathy Headley

Kids visit gas station with a purpose

By Kathy Headley Your correspondent in Chicago Lawn and Marquette Manor 6610 S. Francisco • (773) 776-7778 Last Thursday, third graders from McKay School visited the new Roux Gas Station at 7051 S. Western. The station was recently built on the vacant lot where Napleton Buick and its predecessor, Van Male Buick, once stood. Now…

Richards High School Bands Director Jordan Fransler will be running the Chicago Marathon on Sunday, October 9, raising money for Miracle Network Dance Marathon. (Supplied photos)

Richards teacher to tackle the Chicago Marathon

By Kelly White As bands director at Richards High School in Oak Lawn, Jordan Fransler’s days are filled with education and music, but that’s not all. In his free time, the talented teacher likes to put on his running shoes. “Running became one of my favorite hobbies several years ago. It started out as a…

Neighbors

DVN JCs Restoration House Ad
Worth Mayor Mary Werner and Worth Police Chief Tim Denton expressed concerns over the impending no-cash bail provision of the SAFE-T Act. (File photo)

Some Worth officials are concerned about SAFE-T Act

By Joe Boyle A controversial criminal justice law that goes into effect on Jan. 1 has some Worth public officials apprehensive and believe it will actually cause an increase in crime. Worth resident Jack McGrath said that varying opinions about the Illinois Safety, Accountability, Fairness and Equity-Today Act, or the SAFE-T Act, have arrived in mailings at…

up in smoke license

Worth revokes second business license for selling illegal cigarettes

By Joe Boyle For the second time in less than a month, the Worth Village Board has voted to revoke the license of a business in which illegal cigarettes were being sold. The board accepted the recommendation of the Worth Police Department, which called for the license of Blowing Smoke II Inc., which did business as Up in Smoke, 11015 S. Harlem Ave., to be revoked.…

Pizza Castle will be moving from its longtime home in Chicago's Gage Park neighborhood to new digs in Hickory Hills.

Pizza Castle moving from Gage Park to Hickory Hills

By Bob Bong Pizza Castle has had a long run at its Gage Park neighborhood home on the Southwest Side. But after almost 50 years, the Jensen family is pulling up the roots on the family business and moving to the suburbs. The pizzeria, which was founded in 1973, will be moving to 7737 W.…

market by macy's logo

Macy’s grand opening Friday in Evergreen Park

By Bob Bong The new Market by Macy’s and Macy’s Backstage stores will hold their grand openings this weekend at Evergreen Plaza in Evergreen Park. The new stores will open in the former Carson’s at 9700 S. Western Ave. Market by Macy’s will occupy the first floor and Macy’s Backstage outlet store will take over…

Palos Heights Alderman Michael McGrogan said Tuesday that the council should come up with a solution to the proposed parking lot controversy that would satisfy businesses and residents. (Photo by Jeff Vorva )

Parking lot nixed in Palos Heights but issue not dead yet

By Jeff Vorva The controversial parking lot proposal in Palos Heights was not approved Tuesday night but the issue is not dead. The city council needed a super-majority 6-2 vote for a zoning change from residential to business and granting a special-use permit for a municipal parking lot at 12303 S. 71st Court in the…

SRP-IMAGE-Logo

Clear-Ridge Reporter and NewsHound October 5, 2022

Peggy Zabicki

Senior Center has re-opened

By Peggy Zabicki Your correspondent in West Lawn 3633 W. 60th Place • (773) 504-9327 I hope everyone has been able to enjoy the beautiful autumn weather we’ve been blessed with. I visited the Southwest Regional Senior Center, 6117 S. Kedzie, recently. They are open once again, and everything looks very nice. New floors were installed and there are freshly painted…

Mary Stanek

Tabares’ shred day was a fun event

By Mary Stanek Your correspondent in Archer Heights and West Elsdon 3808 W. 57th Place • (773) 284-7394 Happy National Pizza Month! Don’t we live in a great neighborhood for pizza? There are so many pizza parlors to choose from. There are the big chains and the mom-and-pop establishments. I volunteered on last week at…

Kathy Headley

Kids visit gas station with a purpose

By Kathy Headley Your correspondent in Chicago Lawn and Marquette Manor 6610 S. Francisco • (773) 776-7778 Last Thursday, third graders from McKay School visited the new Roux Gas Station at 7051 S. Western. The station was recently built on the vacant lot where Napleton Buick and its predecessor, Van Male Buick, once stood. Now…

Richards High School Bands Director Jordan Fransler will be running the Chicago Marathon on Sunday, October 9, raising money for Miracle Network Dance Marathon. (Supplied photos)

Richards teacher to tackle the Chicago Marathon

By Kelly White As bands director at Richards High School in Oak Lawn, Jordan Fransler’s days are filled with education and music, but that’s not all. In his free time, the talented teacher likes to put on his running shoes. “Running became one of my favorite hobbies several years ago. It started out as a…

DVN Damar Kaminski Funeral Home House Ad
CRR NH Rainbow Motel House Ad