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Only 4 states tax services by default, but Illinois may join them

By Patrick Andriesen
05/27/2025
Adding sales taxes to services is limited in the U.S., with 46 states not generally taxing services. Illinois may break from the pack and start adding sales taxes to haircuts, lawn care, car repair and a long list of other service expected to cost $2.7 billion.
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Taxed out: 10 reforms to stop Illinois from losing people and jobs

Illinois’ tax code stands in the way of the state’s economic competitiveness. The combination of high tax burdens and a poor tax structure contributes to the loss of jobs and investment to other states. From a place of former economic dominance, Illinois now ranks 45th in gross state product (GSP) growth over the past decade...

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