As Memorial Day approaches, nearly 2 million Illinois residents planning road trips will face significantly higher gas prices compared to last year. The average price per gallon in Illinois has surged to $5.03, up from $3.41, according to AAA. In the Chicago metro area, prices have risen to $5.20 from $3.54.
The primary reason for this increase is the ongoing conflict in Iran, but a substantial portion of the cost is due to taxes. Illinois drivers pay a state gas tax of 48.3 cents per gallon, contributing to a combined federal and state tax of nearly 85 cents per gallon, the second-highest in the United States after California.
Impact on Families and Retail
For families, especially those with middle- and low-income, the high gas prices are a burden. Many drive older, less fuel-efficient vehicles, meaning a larger share of their income goes toward commuting and daily necessities. The cost to fill an average 14-gallon tank has risen to over $70, compared to just under $48 last year.
These increased costs also affect retail prices, as goods transported by road become more expensive. This situation places additional financial strain on Illinois families, who are already managing tight budgets.
History and Future of the Gas Tax
The high state gas tax is a relatively recent development. From 1990 to 2019, the tax remained at 19 cents per gallon. However, in 2019, Governor J.B. Pritzker’s Rebuild Illinois infrastructure program doubled the tax to 38 cents per gallon and introduced automatic annual increases linked to inflation. As a result, the state gas tax is set to rise to 49.6 cents per gallon on July 1.
In addition to the excise tax, Illinois imposes a 6.25% sales tax on gas, which is calculated after the state tax, effectively taxing a tax. The federal gas tax of 18.4 cents per gallon has remained unchanged since 1993.
Before implementing further increases, lawmakers are urged to demonstrate better management of the substantial revenue already collected from Illinois families.
Original reporting: Illinois Policy Institute — read the source article.
