With Illinois residents already paying the second highest gas taxes in the nation, another increase is scheduled for July 1st and calls to freeze it are intensifying.
Under the 2019 “Rebuild Illinois” capital plan, the state’s gas tax was doubled from 19 cents to 38 cents per gallon, with automatic annual increases tied to the Consumer Price Index (CPI). This year, the rate is set to rise again, reaching 48.3 cents per gallon.
While revenue from the motor fuel tax is earmarked for transportation infrastructure, critics argue that Illinois drivers aren’t seeing sufficient returns on their investment.
“The state just keeps on taking more taxes and there has been very little to show for it,” said Ravi Mishra, policy analyst with the Illinois Policy Institute (IPI). “From research that we have conducted, our roads have not gotten much better since the increase in taxes.”
Illinois Republicans have introduced legislation aimed at pausing automatic CPI-linked fuel tax hikes. They argue the state’s Road Fund—currently holding nearly $3.7 billion as of May 12th is more than sufficient to support infrastructure needs without additional burdens on drivers.
“As Springfield nears the end of the 2025 Spring Session and budget talks ramp up, it is important for legislators to remember increasing the motor fuel tax not only impacts their constituents directly, through their increased cost at the pump, but also indirectly, through increased costs of goods and services throughout the economy,” said Nate Harris, CEO of the Illinois Fuel and Retail Association.
IPI also criticizes the state’s practice of applying sales tax after the motor fuel tax is added—creating what they call a “tax-on-tax” burden for Illinois drivers.
Comments