The value of the input box must also be governed by the state. So the input should be like:

<input
   value={toDo}
   type="text"
   placeholder="Type item here..."
   onChange={handleToDo}
/>

Once You click on submit, reset the toDo to empty

const submit = () => {
//const list = toDoList;
const newItem = {
  id: 1 + Math.random(),
  value: toDo,
};
if (newItem.value && !toDoList.includes(newItem.value)) {
  toDoList.push(newItem);
  setToDoList([...toDoList]);
}
setToDo("");
};

Your input seems to be half-controlled. You should also give the input a value property as such:

<input
 type="text"
 placeholder="Type item here..."
 onChange={handleToDo}
 value={toDo}
/>

And now you can clear out the input when a task is submitted:

const submit = () => {
    //rest of the code here...
    setToDo('') //this'll clear out the value of your input
 };

You can add a value to input element. And after submit, set it to an empty string. So:

const App = () => {
  const [toDoList, setToDoList] = useState([]);
  const [toDo, setToDo] = useState("");

  const handleToDo = (event) => {
    const { value } = event.target;
    setToDo(value);
  };

  const submit = () => {
    //const list = toDoList;
    const newItem = {
      id: 1 + Math.random(),
      value: toDo,
    };
    if (newItem.value && !toDoList.includes(newItem.value)) {
      toDoList.push(newItem);
      setToDoList([...toDoList]);
      setToDo("");
    }
  };

  return (
      <div className="container">
          Add an Item
          <br />
          <input
            type="text"
            value={toDo}
            placeholder="Type item here..."
            onChange={handleToDo}
          />
          <button className="add-btn btn-floating" onClick={submit}>
            <i class="material-icons"> + </i>
          </button>
          <br />
          <ul>
            {toDoList.map((todoLi) => (
              <li>{todoLi}</li>
            ))}
          </ul>
        </div>
  );
  //}
};

export default App;