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What is the Business District Development and Redevelopment Sales Tax?

The Business District Development and Redevelopment Law authorizes a municipality to impose a tax designed to fund the development or redevelopment of certain designated areas within a municipality. The municipality may impose this tax if it has a development or redevelopment plan for an area of the municipality that:

  • is contiguous (i.e. the properties within the area border each other),
  • includes only parcels of real property that will directly and substantially benefit from the proposed plan, and
  • is blighted, as defined in the Illinois Municipal Code (see 65 ILCS 5/11-74.3-5)

The business district sales tax is imposed by the municipality in the form of the Business District Retailers’ Occupation Tax and Business District Service Occupation Tax.

For more information, see PTAX-1002-20, Local Governments' Guide to Tax Allocations, Business District Development and Redevelopment Sales Tax.

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You may access additional information by searching the entire Illinois Department of Revenue website.

If you have additional inquiries, you may submit them on the Questions, Comments, or Requests form.