Prepared Food & Beverage Tax

Prepared Food and Beverage tax is imposed upon the retail purchase of prepared foods and beverages and all alcoholic beverages at any Prepared Food Facility or Retail Liquor Facility within the Village, at the rate of one percent of the purchase price of such prepared food, prepared beverage, or alcoholic beverage, the ultimate incidence of any liability for payment of the tax shall be borne by the purchaser.


Ownership Duties

The owner and the operator of each Prepared Food Facility and each Retailer Liquor Facility within the Village shall jointly and severally have the duty to cause to be filed, a sworn return with the Finance Director for each facility and for each licensed premises located in the Village. The return shall be prepared and submitted on forms prescribed by the Village and filed with the Village by the filing date and at the same time intervals or frequencies as the Sales and Use Tax Return, form ST-1, is due to be filed with the Illinois Department of Revenue.

The return shall also be accompanied by payment to the Village of all taxes imposed, which are due and owing for the period covered by the return. The return shall also be accompanied by a copy of the return filed with the Illinois Department of Revenue for sales within the Village of Palatine covering the same reporting period.

Documents

  1. Food and Beverage Tax Return Form (PDF)

Non-Palatine Based Business F&B Tax Remittance

For vendors that are not based in Palatine, you must make arrangements to remit applicable sales tax and Prepared Food and Beverage Tax when making sales in Palatine. Please see below for more information on vendors not based in Palatine for Prepared Food and Beverage Tax remittance and see Other Events webpage for more information on sales tax remittance.

Vendor Instructions- F&B Tax

In addition to sales tax, the Village of Palatine collects a Prepared Food and Beverage Tax. The Prepared Food and Beverage Tax is a 1% tax on the retail sale of prepared food and beverages within Palatine. The Prepared Food and Beverage tax applies to “prepared” food and beverage items (which include items that are available for immediate consumption) sold by restaurants, bars, concession stands, snack shops, mobile food vendors, or any similar type of establishment. The Prepared Food and Beverage tax applies to all sales that occur within the Village, regardless of the location for which the business is based. The Village’s 1% Prepared Food and Beverage Tax is in addition to and separate from the sales tax remitted to the State. It is the responsibility of any business owner who thinks they may be subject to this local Prepared Food and Beverage Tax to implement and remit this tax to the Village.

Although the Prepared Food and Beverage Tax can be passed on to patrons, the business owner is responsible for collecting and submitting this tax to the Village. Each business will need to determine the best mechanism for charging and collecting this tax.

Note: The Village of Palatine retains the right to audit the books of any business subject to this tax as outlined in Chapter 17 of the Village’s Code of Ordinances.

Food and Beverage Taxes must be submitted separately from any other tax you may be liable for.  Food and Beverage Tax remittance cannot be paid online. Instructions on remittance can be found here. You must either:

  1. Mail the Village’s Food and Beverage Tax payment form and corresponding check to the Village of Palatine’s Finance Department, or
  1. Drop off the Village’s Food and Beverage Tax payment form and corresponding check or cash payment to the Village’s Finance Department.

For temporary vendors, you only need to remit at the conclusion of the event. For example, Farmers Market vendors would only need to remit after the end of the seasonal farmers market, or a weekend event vendor would submit after the weekend event.

Forms and Resources: