Illinois motorists will soon see a slight increase in gas prices as the state’s tax on fuel is set to rise by more than 3%. Starting next month, drivers filling up their tanks will notice a bump in prices at the pump.
According to the Illinois Department of Revenue, the tax rate on gasoline will go up by just over 3.5%, climbing from $0.454 per gallon to an even $0.47. Diesel fuel prices will also see an uptick, rising from $0.529 per gallon to $0.545, an increase of just over 3%.
In 2019, Illinois passed a law to implement annual increases in fuel taxes after decades without adjustments. The tax has been on the rise since then, with the initial doubling from $0.19 per gallon to $0.38. Subsequent increases have followed, with adjustments based on inflation and changes in the Consumer Price Index.
After a pause in 2022 due to inflation concerns, the state has now raised the tax rate three times. The revenue generated from the fuel tax is dedicated to funding construction projects at both state and local levels, as mandated by a Constitutional amendment approved by voters in 2016.
Since July 2023, Illinois has collected over $2.9 billion in gas tax revenue, according to the Illinois State Comptroller’s Office. In addition to the state fuel tax, motorists are also subject to federal excise taxes on fuel and state sales taxes, which are applied after the inclusion of the state’s fuel tax in the price.
