The Business District Development and Redevelopment Law authorizes a municipality to impose a tax designed to fund the development or redevelopment of certain designated areas within a municipality. The municipality may impose this tax if it has a development or redevelopment plan for an area of the municipality that:
- is contiguous (i.e. the properties within the area border each other),
- includes only parcels of real property that will directly and substantially benefit from the proposed plan, and
- is blighted, as defined in the Illinois Municipal Code (see 65 ILCS 5/11-74.3-5)
The business district sales tax is imposed by the municipality in the form of the Business District Retailers’ Occupation Tax and Business District Service Occupation Tax.