Kildeer seeking local sales tax hike to offset loss of Best Buy, other factors
Kildeer lost its top sales tax producer when Best Buy closed earlier this year.
Another store has filled the space in the Quentin Collection shopping center at Route 12 and North Quentin Road. But because it won’t match the revenue generated by Best Buy and other factors, Kildeer voters will be asked to approve an increase in the local sales tax rate.
A question on the Nov. 5 ballot will ask whether voters want to increase the local sales tax rate by 1/2% to 8%. Village officials say the increase — the first being sought in about 12 years — would put Kildeer on par with Deer Park and Long Grove, which charge 8%.
“Our stores won’t be at a disadvantage if people were even aware of it,” said Michael Talbett, chief village officer.
Lake Zurich also plans to seek approval for a sales tax increase that will equal the rate charged by surrounding villages, he noted.
After Best Buy closed in March, Whole Foods Market became Kildeer’s top sales tax producer, Talbett said. But revenue from that source, too, will drop with the repeal of Illinois’ 1% grocery tax on Jan. 1, 2026.
A 1/2% of sales tax equates to about $400,000 for the village, according to Talbett.
He said the furniture store won’t replace the amount Best Buy was generating for the village. And with the state grocery tax being dropped, increasing the local share of sales tax was regarded as the preferred option.
“We’re just trying to stay in place given the loss of sales tax that will occur,” Talbett noted.
A successful referendum would replace revenue the village used to have but no longer does and go into the general fund “so we don’t have to raise revenue some other way,” Talbett said.
An increased sales tax will avoid the need for a property tax increase and equal the sales tax already being charged in Deer Park and Long Grove, residents were informed in a recent electronic newsletter.
The burden will be distributed equally as sales tax applies to all shoppers most of whom are not village residents, he added.
Other factors also contributed to the decision to pursue a sales tax increase.
Talbett said there is little land available for development and a shift from retail to service uses means communities can’t count on a natural progression in sales tax revenues.
More information about the referendum will appear in future editions of the village newsletter.
“Now we need to step up a bit to educate voters,” Talbett said.