October 28, 2021

Illinois taxes candy differently, charging six times more for one flavor of candy bar than for another by the same manufacturer


CONTACT: Melanie Krakauer (312) 607-4977

Which Halloween candy has the highest taxes? 
Illinois taxes candy differently, charging six times more for one flavor of candy bar than for another by the same manufacturer

CHICAGO (Oct. 28, 2021) – Illinois’ spooky season offers candy shoppers something to chew on: much higher taxes on one bag of candy compared to another.

An Illinois Policy Institute analysis of 2019 data finds Illinois is one of 18 states to levy a “candy tax” – a full sales tax on treats sweetened with sugar, honey, or sweetener that essentially declares they are not regular groceries. But not every candy is taxed the same.

Here’s why: Most foods such as milk, eggs, fruits and vegetables are exempt from the typical Illinois state sales tax of 6.25% and are instead charged a 1% grocery tax. However, sweetened foods such as Skittles, gummies, popcorn, chocolate bars, chocolate chips and even honey-roasted peanuts and breath mints have been taxed at 6.25% in Illinois since 2009.

The exception is candy containing wheat, such as Kit Kat and Twix bars, which are taxed at the lower 1% grocery rate.

“This is something for Illinoisans to be aware of this holiday season so they can choose to follow their taste buds or their wallets,” said Adam Schuster, senior director of budget and tax research at the Illinois Policy Institute.

That means a Halloween shopper will pay six times more in sales tax buying a $3.59 bag of Hersey’s Milk Chocolate bars than on a $3.59 bag of Hersey’s Cookies ‘N’ Crème bars. The same is true for regular or peanut M&Ms versus pretzel M&Ms, which contain wheat. Other outliers are Mars bars, chocolate-covered pretzels and licorice – all taxed at 1% because they contain wheat.

“A competitive tax system should be attractive for businesses and residents, neutral, easy to understand and treat everyone fairly. That’s not what we see here,” Schuster said.“This is the result of politicians working ad hoc – and as a result creating a distortion between products. It wasn’t about nutritional differences; it was about raising revenue.”

To read more about Halloween candy taxes, visit illin.is/candytax.

For bookings or interviews, contact media@illinoispolicy.org or (312) 607-4977.