A new tax is imposed in Chicago for each “place of eating” located in the City, at the rate of .25% of the selling price of all food and beverages sold at retail by the place of eating. Effective April 1, 2004, this tax only applies to food prepared for immediate consumption, whether that happens at a restaurant, a “place for eating”, a business providing accommodations for eating the food on premises, or at a grocery or department store that includes an area where prepared food is sold. A “place for eating” is defined as a business that is engaged in the sale at retail of food prepared for immediate consumption and provides for on-premises consumption of the food it sells. This does not include typical grocery store items bought without the intent of on-premises consumption, prepared food sold by school cafeterias, food sold by hospitals to their patients and all sales of food and beverages which may not be taxed by the City under applicable law. This tax will apply to eating establishments with over $80,000 in annual tax year sales (July 1 through June 30). (City of Chicago Department of Revenue, Chicago Tax Regulations, effective April 1, 2004)