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ILLINOIS
HAS HIGHER GAS PRICES THAN NATIONAL AVERAGE, ALL NEIGHBORING STATES,
HEADING INTO MEMORIAL DAY WEEKEND
Illinois Policy Institute/Brendan
Bakala
Motorists in Chicago face higher gas prices
than the national and state average, due in part to the multiple layers
of taxes heaped upon by state, county and local government.
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 As travelers across the country hit the road this Memorial Day weekend, drivers
in Illinois – and especially Chicago – will feel some extra pain at the pump.
Gas prices nationwide are expected to see a slight increase due to Memorial Day
demand, but the rise will be amplified across Illinois and particularly in the
Windy City due to the layers of taxes state and local government tack on.
Nationally, as of May 26 the average price for a gallon of unleaded gasoline is
$2.37. Illinois’ gas prices are slightly higher than the national average at
$2.45.
Illinois’ gas prices are higher than in all of its bordering states. Missouri
has the cheapest gas of Illinois’ border states, and one of the least expensive
statewide averages in the country. The average price of gas in the Show Me State
is only $2.15 per gallon, making it more than 20 cents cheaper than the national
average and about 30 cents cheaper than Illinois’ average price.
Things are
even worse for Chicago drivers, where the average price is $2.79 per gallon.
One of the reasons Chicagoans pay so much more for gas is because of the
multi-layered taxes levied on fuel at both the state and local level.
On top of the federal gasoline excise tax, Illinois charges a 19-cent state
excise tax on gasoline as well as an environmental tax. Illinois is also one of
only seven states that apply state sales tax to gas purchases. Unlike standard
motor fuel taxes which charge a fixed amount per gallon of gas, sales taxes
charge a percentage of a sale, meaning the more expensive gas is, the more
expensive the tax bill will be. And though in Illinois, revenue from the state
gas tax goes toward road maintenance and infrastructure, the same cannot be said
for state sales tax on gas. Revenue accrued from the state sales tax on gas goes
to the state general fund, to be spent how lawmakers see fit.
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Overall, the Prairie State is ranked 11th in the county for its
gasoline tax burden and is more expensive than each of its bordering
states, according to a report from the Tax Foundation.
For Chicago motorists a slew of localized taxes intensify this
burden. And just like at the state level, drivers are not immune
from paying local sales taxes which charge by percentage. Both Cook
County and Chicago charge a sales tax as well as excise and home
rule taxes, all of which increase the price of gas.
Thankfully for drivers, the price of gas has been dropping in recent
years. Though the national average price saw a slight bump up from
2016, the current 2017 average is nearly $1.30 cheaper than at this
time in 2014. This trend has also trickled down to Chicago where the
average price of gas for Memorial Day weekend in 2014 was $4.14 a
gallon, but for Memorial Day weekend 2017 the average price of gas
is only $2.78.
One estimate from Illinois Homepage states that gas prices for
Memorial Day 2017 will be the second cheapest in the past decade ̶
welcome relief for overtaxed Illinois drivers, though they will
still pay more than the state’s neighbors.
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