Chicago: 7th most expensive city in the world

Chicago: 7th most expensive city in the world

Driven by a costly tax burden, Chicago’s high cost of goods and services lands the Windy City in the top 10 for the most expensive 71 cities across the world, according to a new survey by UBS.

Chicago ranks as the seventh most expensive city among 71 cities across the world, according to UBS’s new “Prices and Earnings Study.” UBS compared the cost of a standardized basket of 122 goods and services in 71 cities around the world, as well as the wages of the people who live in those cities.

Chicagoans pay more to live in their city than do residents of 64 cities in the study, including Miami and Los Angeles, and even Tokyo and Paris. It costs more to live in New York and the Swiss cities of Geneva and Zurich than to live in Chicago, however, as noted by the Chicago Tribune in an article on the survey.

So, why does a shopping spree on the Champs-Élysées in Paris or on Fifth Avenue in New York cost less than an excursion on Michigan Avenue? Chicagoans can thank their 10.25 percent sales tax, now the highest in the U.S., for that.

Chicago ranked seventh among the cities surveyed both when the authors included and excluded rent, and Chicago is more expensive than Miami and Los Angeles in both cases. When UBS included rent, New York City had the highest cost of living, Miami ranked 11th and Los Angeles came in 13th. Excluding rent, New York ranks third, Miami, 16th, and Los Angeles, 17th.

Chicagoans came in 10th place for wages, behind New York, which the survey listed at No. 4; Miami at No. 5; and Los Angeles at No. 9. By comparison, residents of Geneva, Zurich and Luxembourg earn the most, and people living in Nairobi, Jakarta and Kiev earn the least.

Chicagoans pay more for clothing, which contributed to the overall expense of living in the Windy City compared to other locales. A woman in Chicago would pay more than twice what her colleague in Warsaw, Poland, would pay for new business clothing, according to the Chicago Tribune.

And Chicagoans pay more for household appliances, such as refrigerators, vacuum cleaners and hairdryers, than residents of most other cities in the survey, even those in New York and London. In fact, this bundle of household appliances costs almost twice as much in Chicago as it does in Miami or Dublin.

The sales tax isn’t the only burden city residents face. While Chicagoans are among the lucky dwellers of only seven cities in the survey where workers need to work less than 30 hours to buy an iPhone 6, as of Sept. 1, Chicago residents must pay a 9 percent “Netflix tax” on any videos they stream on those iPhones.

The city of Chicago is taxing away the purchasing power of its residents. And Mayor Rahm Emanuel’s call for $750 million in new property taxes, garbage-collection fees and other taxes will exacerbate this. If Chicago wants to rank as a world-class city for quality of life – rather than costliness – it must reduce the tax burden that makes it so expensive to live in the Windy City.

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