Chicago has second highest taxes on meals in restaurants

March 29, 2012
By Illinois Policy

Ever notice that going out to eat seems more expensive in Chicago than other cities? One of the reasons is that on top of the very high sales tax in Chicago, there are additional taxes on meals in restaurants: 0.25 percent Chicago restaurant tax and 1.0 percent Metropolitan Pier and Exposition Authority (MPEA) food and beverage tax. The MPEA tax is only applicable for certain parts of Chicago, specifically both airports and the downtown Chicago area.

Chicago isn’t the only city that has these types of taxes. “Prepared meal” taxes can vary significantly, and a recent analysis by the Tax Foundation found that 15 of the largest 50 cities in the U.S. charge an additional tax ranging from 0.05 percent in Milwaukee to 5.5 percent in Virginia Beach. When meal taxes are combined with sales taxes, the cities with the highest taxes on meals are Minneapolis (10.775%), Chicago (10.75%), Virginia Beach (10.5%), Seattle (10.0%) and Washington, DC (10.0%). By contrast, Portland, Oregon doesn’t have a sales tax or a meal tax.

Table 1: Meals Taxes in the 50 U.S. Cities with Largest Population

Population Rank City State Sales Tax Additional Meals Tax Combined Tax on Meals Combined Tax Rank
1 New York City NY 8.875% 8.875% 18
2 Los Angeles LA 8.75% 8.75% 19
3 Chicago IL 9.50% 1.25% 10.75% 2
4 Houston TX 8.25% 8.25% 25
5 Philadelphia PA 8% 8% 33
6 Phoenix AZ 9.30% 9.30% 7
7 San Antonio TX 8.25% 8.13% 30
8 San Diego CA 7.75% 7.75% 37
9 Dallas TX 8.25% 8.25% 25
10 San Jose CA 8.25% 8.50% 22
11 Jacksonville FL 7% 2% 9% 14
12 Indianapolis IN 7% 2% 9% 14
13 San Francisco CA 8.50% 8.50% 22
14 Austin TX 8.25% 8.25% 25
15 Columbus OH 6.75% 6.75% 45
16 Fort Worth TX 8.25% 8.25% 25
17 Louisville KY 6% 6% 46
18 Charlotte NC 8% 1% 9% 14
19 Detroit MI 6% 6% 46
20 El Paso TX 8.25% 8.25% 25
21 Memphis TN 9.25% 9.25% 9
22 Baltimore MD 6% 6% 46
23 Boston MA 6.25% 0.75% 7% 43
24 Seattle WA 9.50% 0.50% 10% 4
25 Washington DC 6% 4% 10% 4
26 Nashville TN 9.25% 9.25% 9
27 Denver CO 4.10% 4% 8.10% 31
28 Milwaukee WI 5.60% 0.05% 5.65% 49
29 Portland OR 50
30 Las Vegas NV 8.10% 8.10% 31
31 Oklahoma City OK 8.375% 8.375% 24
32 Albuquerque NM 6.9995% 6.9995% 44
33 Tucson AZ 9.10% 9.10% 11
34 Fresno CA 7.975% 7.975% 36
35 Sacramento CA 7.75% 7.75% 37
36 Long Beach CA 8.75% 8.75% 19
37 Kansas City MO 7.85% 1.23% 9.08% 12
38 Mesa AZ 9.05% 9.05% 13
39 Virginia Beach VA 5% 5.50% 10.50% 3
40 Atlanta GA 8% 8% 33
41 Colorado Springs CO 7.40% 7.40% 42
42 Omaha NE 7% 2.50% 9.50% 6
43 Raleigh NC 6.75% 1% 7.75% 37
44 Miami FL 7% 2% 9% 14
45 Cleveland OH 7.75% 7.75% 37
46 Tulsa OK 7.50% 7.50% 41
47 Oakland CA 8.75% 8.75% 19
48 Minneapolis MN 7.775% 3% 10.775% 1
49 Wichita KS 9.30% 9.30% 7
50 Arlington TX 8% 8% 33