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 On June 28, Gov. J.B. Pritzker signed into law a $45 billion
infrastructure plan that will bring Illinois drivers a record gas tax hike and
higher vehicle registration costs.
Those tax and fee increases will come in addition to tax hikes on cigarettes,
e-cigarettes, parking and real-estate transfers, on top of new revenue from a
massive gambling expansion that includes new casinos and legalized sport betting
– all of which the Illinois General Assembly introduced and passed in a single
day.
 The gas tax hike is the most painful increase to come, doubling to 38 cents from
19 cents per gallon.
This will bump Illinois’ total gas tax burden to the third-highest in the
nation, and possibly higher if local governments exercise their increased taxing
authority under the plan. An Illinois Policy Institute analysis found the
typical Illinois driver will pay at least $100 more on gasoline each year under
a doubled gas tax.
Illinois is one of just seven states where drivers pay layers of both general
sales taxes and special excise taxes on gasoline at the state and local levels.
Those multiple layers mean drivers filling up in Chicago, for example, will pay
96 cents in taxes and fees on a $2.46 gallon of gasoline – an effective tax
burden of 39%.
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The infrastructure plan also hikes Illinois’
vehicle registration fees to among the highest in the nation.
Illinois drivers of standard vehicles weighing 8,000 pounds or less
will see registration fees jump to $148 from $98.
The gas tax hike kicks in July 1, and motorists will pay more for
license plate stickers starting in 2020.
Taken together, increases in the gas tax and
vehicle registration fees alone erase any promised income tax
savings included in Pritzker’s progressive income tax plan, which
Illinoisans will vote on in November 2020.
Under Pritzker’s proposed progressive tax system, a married couple
in Illinois with two kids earning the $79,168 median annual income
and paying the average property tax bill of $4,157 would see $195 in
total tax relief, according to the Pritzker administration’s online
“fair tax calculator.”
But if that same family uses two cars on a regular basis, their
budget will take a $300 hit – a $200 gas tax increase and a $100
vehicle registration fee hike.
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