Chicago’s five-cent bottled water tax that took effect Jan. 1 is unconstitutional, a lawsuit filed by the state’s major food and beverage retail associations late last week asserts.
The groups include the Illinois Retail Merchants Association, the Illinois Food Retailers Association, the American Beverage Association, and the International Bottled Water Association. The lawsuit, which seeks to have the tax declared null and void, was filed in Cook County Circuit Court.
The groups allege that bottled water meets the definition of a food item and that the city lacks the authority even under state home rule laws to tax food items. The lawsuit alleges that the city’s singling out of bottled water also violates the state constitution’s uniformity clause.
“This will affect any Chicago retailer that sells bottled water because people will shop at grocery stores outside the city,” David Vite, head of the Illinois Retail Merchants, said in a statement. “And they’re going to buy more than just bottled water at those stores. They’re going to buy all their groceries there. This tax is just bad business for Chicago and its consumers.”
The tax was expected to raise about $10.5 million this year for city coffers. The City Council approved the tax in November along with the 2008 budget as part of a package of tax and fee increases that included a property tax increase.
Mayor Richard Daley pushed for the increases to help close a looming deficit and raise new money to pay for city services and to improve libraries. Officials also pushed the tax as a means to promote a reduction in bottled water consumption because the plastic bottles are often sent to landfills and not recycled.
