Judge tosses Cook Co.’s tax on out-of-county purchases
BY BECKY SCHLIKERMAN Staff Reporter October 8, 2013 7:30PM
Cook County Board President Toni Preckwinkle | Sun-Times files
Updated: November 10, 2013 6:37AM
A circuit court judge ruled Tuesday a Cook County tax is unconstitutional and has determined it can’t be enforced, according to a lawyer involved in a lawsuit against the county and its tax.
In a decision he handed down from the bench, Cook County Circuit Court Judge Robert Lopez Cepero determined that a Cook County tax on purchases made outside the county violated the county’s code, the state’s constitution and the U.S. Constitution, said attorney Michael Wynne, who represents the Chicagoland Chamber of Commerce and his law firm Reed Smith in a lawsuit against the county.
Wynne declared the ruling “a victory for all taxpayers.”
A written order is expected on Friday, Wynne said.
The county is waiting for that written order to appeal, county spokesman Owen Kilmer said.
The tax in question applies to purchases made outside of Cook County for tangible goods such as office supplies and furniture that are used in Cook County. But the tax does not include real estate or vehicles. Buyers in Cook County are liable for the tax once their purchases exceed $3,500 per year.
It was instituted in 2012 to capture revenue from deals by Chicago-area companies seeking to avoid the county’s sales tax. It was promoted as part of a “buy local” push to keep business within the county.
But the tax and its reporting requirements drew complaints. At least two lawsuits accuse the county of illegally imposing a value-based tax not authorized by the state Legislature. Cook County Board President Toni Preckwinkle has argued the tax falls within the county’s home-rule powers.
The Cook County Board reduced the tax from 1.25 percent to 0.75 percent in June.
The reduced rate matches the county’s sales tax rate. County officials said the partial rollback answers a legal challenge that differential tax rates violate the U.S. Constitution.
The county is expected to unveil next year’s budget on Thursday.
It was not immediately known Tuesday night how the judge’s decision would affect next year’s budget because of the anticipated appeal, Kilmer said.