Congestion pricing is being considered for Chicago. We are not New York. Congestion pricing will not cover the city’s almost $IB budget deficit. This short-term solution will have long-term unintended impacts.
Parking in Chicago has become more of a headache in recent years. Residents already pay some of the highest parking taxes in the nation. Still, as of 2025, the Chicago monthly parking tax rate has skyrocketed to 41.25%—the highest of any major U.S. city.
As you can imagine, this affects Chicago’s workers, tourists, and local businesses. In fact, over 70% of Chicagoans utilize parking garages for work-related purposes. With rising parking costs, businesses and tourism are at risk.
What Is the Chicago Parking Tax Rate in 2025?
As of 2025, the Chicago monthly parking tax rate is more than twice the sales tax and higher than any other major city in the United States.
Breakdown by Type: Daily vs. Monthly Parking
| Weekend/Daily | Monthly | |
| Cook County | 6% | 9% |
| State of Illinois | 6% | 9% |
| City of Chicago | 23.25% | 23.25% |
| Total Parking Tax | 35.25% | 41.25% |
Chicago Has Higher Parking Taxes Than Any Other Major U.S. City
Chicago parking taxes range from 35.25% to 41.24% on every dollar—and every minute—spent parking a car. The discrepancy between Chicago’s rates and those of other major U.S. cities is hard to ignore, especially when the proposed congestion tax is higher than Manhattan’s.
Who’s Paying the Price?
The 70% Majority: Workers Parking for Their Jobs
Most Cook County workers rely on parking garages for their daily commute, highlighting the importance of accessible and affordable parking for the county’s workforce.
With this in mind, congestion pricing will lead to an indirect wage cut for Chicagoans. These rising expenses can impact overall compensation, as employers may be less inclined to cover parking fees.
As a result, workers may have to pay for parking out of their own pockets.
Chicago Commuters, Small Businesses, and Tourists Feel the Pinch
Getting around town can cost a pretty penny if you’re not taking public transit. The city expects to profit substantially by raising the weekly Chicago parking tax rate to 23.25%.
Some employers have begun offering parking as a perk. However, many workers who travel downtown are forgoing driving altogether and choosing either public transit or rideshare options.
Chicago tourism also suffers due to parking taxes, with many tourists choosing suburban accommodations instead of the city.
Chicago Congestion Tax: How It’s Expanding
Chicago already has a congestion pricing program that imposes a fee on rideshares like Uber and Lyft. This extra fee has been exclusively implemented for rideshare trips beginning or ending in the central business district and other high-demand areas.
Recently, there has been growing interest in extending congestion pricing to all vehicles entering the central business district—not just rideshare vehicles.
Expanding this congestion pricing system would require developing a new tolling system to identify and charge all vehicles entering the central business district and establishing an office for customer service.
How Chicago Parking Taxes Deter Growth
Businesses Rethink Downtown Footprint
With the Chicago parking tax rate calculated into their overhead, many businesses are reconsidering having locations downtown. If they choose to relocate or downsize, these decisions will negatively impact Cook County workers.
Lost Tourism Revenue
Chicago is a beautiful city that deserves to be explored, but high parking taxes are deterring tourists.
Visitors want a great first impression, but Chicago parking taxes can sour their overall experience. The city is already expensive—who wants to pay high fees before even stepping out of their vehicles?
Is There a Better Way?
Possible Alternatives to Ease the Burden
Suggestions to ease the burden of Chicago parking taxes include:
- Implementing tiered taxes based on location or usage
- Offering incentives for carpooling or parking during off-peak hours
- Temporary relief for essential workers, including hospital workers
What Other Cities Are Doing Differently
You know what they say—everything in moderation. Other cities are lowering their parking taxes by experimenting with pricing strategies to manage parking demand.
FAQs About the Chicago Parking Tax
Q: Why is the Chicago parking tax so high?
A: It’s a layered tax from Cook County, Illinois, and the City of Chicago. Combined, they create the highest rate in the country.
Q: Does the rate apply to all types of parking?
A: Yes—for garages, lots, and valet services. Monthly parkers face the steepest rates.
Q: Can businesses deduct these taxes?
A: Some may offset through operating costs, but most pass them on to customers or staff.
Q: Are there any exemptions?
A: Not for general public use. Government vehicles and some nonprofit organizations may qualify.
The Bottom Line
Chicago’s parking tax rate is so high that it’s become a national outlier. This affects workers, commuters, businesses, and tourists. The higher the parking prices, the more problems Cook County workers can expect to face.
The Parking Industry Labor Management Committee (PILMC) urges Cook County, the city of Chicago, and the state of Illinois to reevaluate a healthier tax model to support the city’s recovery and growth instead of hindering it.
Join us for an informative webinar on the status of parking taxes!