Illinois DOR Clarifies Dietary Supplements as Grocery Exempt from State Tax in 2026

The Illinois Department of Revenue (DOR) issued a general information letter, clarifying that beginning Jan. 1, 2026, dietary supplements that do not make medicinal claims on their labels will be considered “groceries” exempt from the State’s Retailers’ Occupation Tax, but subject to any applicable local grocery taxes imposed by municipalities or counties under new laws. The DOR explained that prior to Jan. 1, 2026, dietary supplements meeting the definition of “food” were taxed at the reduced 1 percent State rate, unless they made medicinal claims and qualified as “drugs”, which were also taxed at 1 percent. [Ill. Dep’t of Revenue, ...