FAQs • Normal, IL • CivicEngage

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Use Tax

1. Why is there a Bloomington/Normal Use Tax?: Effective September 1, 1990, the State of Illinois changed the law as it applied to local sales taxes. From that point forward, the State began collecting the 0.75% sales tax on all purchases, with the exception of the sales tax applied to all titled transactions. This tax, according to state law, was to be collected locally and would apply only to the residents of cities that had previously applied the local sales tax.

2. Is the Use Tax new?: No, however, the name and method of collection are new. The cities of Normal and Bloomington have, at separate council meetings, decided to proceed with the local collection of the Use Tax. Since the tax only applies to all titled items, it is called a use tax.

3. How is the tax paid?: Local dealers are required to collect the tax at the time of purchase of any item requiring a title. Collection for out-of-town dealers is discretionary.

4. Do out-of-town dealers know about the tax?: The Bloomington/Normal Use Tax Division notified most new car dealers within a 60 mile radius of Bloomington/Normal. Their cooperation in collection of the tax is requested. It was also suggested that the dealers who chose not to collect the tax notify the purchaser that they would receive an assessment from the Bloomington/Normal Use Tax Division.

5. What is the Bloomington/Normal Use Tax Division?: It is a cooperative effort to economize. Bloomington and Normal have designed one local system to collect the tax for both cities.

6. Who gets the revenue generated by the tax?: The 0.75% tax collected from residents of Bloomington is paid to the City of Bloomington. The 0.75% tax collected from residents of Normal is paid to the Town of Normal.

7. What is the money used for?: These revenues go into the General Fund to provide basic services to residents of the two cities.

8. What is the State of Illinois ST-556 form?: The ST-556 form is completed by the dealer to submit your 6.25% sales tax to the state. The dealer should give you the blue copy of this form. If you do not have the form, please call your dealer to get a copy.