Wanna Bet There's a Gas Tax Coming?

Lawmakers may scrap casino plans to raise gas tax

View Comments (
)
|
Email
|
Print

    NEWSLETTERS

    Getty Images
    Nationally, the average state gas tax is 18.4 cents a gallon, according to the oil trade group API. The midwestern average is 21.7 cents. Illinois is one of the few states that also charges sales tax on gasoline, making the total tax burden even higher here.

    New Senate President John Cullerton says Illinois lawmakers should forget about adding casinos to pay for a statewide construction program and instead start thinking about an increase in the gasoline tax.

    In an interview, Cullerton said the state needs a major capital program too badly to depend on "illusory" hopes of a major gambling expansion. Raising the 19-cents-a-gallon gasoline tax might be a better option, he said, noting it hasn't been increased in years.

    Whatever happens with the construction program, state government still faces a budget deficit that could approach $9 billion next year.

    Cullerton showed no interest in major budget cuts to reduce the deficit. Most of the state budget goes to health care and education, which shouldn't be cut, he said. The rest is a few billion dollars -- far too little to eliminate the deficit.

    "That's why you have to say everything is on the table. It's not a cliche," the Chicago Democrat said. "This is a crisis."

    Cullerton refused to take a position on whether to raise income taxes, saying he wants to hear from new Gov. Pat Quinn on that first.

    "We're just going to wait and see what he proposes and react to it," Cullerton said.

    But Cullerton did offer two preliminary ideas for bringing in more money: selling lottery tickets on the Internet and hiring a private firm to improve management and marketing of the state lottery. Those steps could boost revenue by several hundred million a year, he predicted.

    Cullerton was elected Senate president last month, replacing the retiring Emil Jones. He entered office with the state facing both a financial crisis and a leadership crisis. The leadership crisis ended with Gov. Rod Blagojevich being impeached and removed from office.

    Now Cullerton and other officials must figure out how to pay the state's bills.

    One Springfield proposal calls for raising the gasoline tax by eight cents a gallon to 27 cents.

    The increase could be a hard sell, particularly when the public already is worried about making ends meet, but Cullerton is not alone in talking about raising the gasoline tax. House Speaker Michael Madigan, D-Chicago, also is interested.

    Nationally, the average state gas tax is 18.4 cents a gallon, according to the oil trade group API. The midwestern average is 21.7 cents. Illinois is one of the few states that also charges sales tax on gasoline, making the total tax burden even higher here.

    Cullerton didn't flatly endorse a higher gas tax during the 30-minute interview Tuesday, but he reeled off a long list of reasons it would make sense.

    The tax hasn't been raised in nearly 20 years, he said. Back then gas cost about $1 a gallon, so the tax was nearly 20 percent. Today, with prices more like $1.90, the tax is the equivalent of 10 percent.

    More fuel-efficient cars today mean people put wear and tear on state highways but pay less in taxes because they buy less gasoline, Cullerton said. A higher tax would give the state more money to keep up with that wear and tear.

    People could, at least to some degree, avoid paying the tax by using public transportation, carpooling or reducing their driving -- which would also reduce pollution, he said.

    Cullerton didn't address worries that consumers soon might see gas prices jump to the $4-a-gallon levels of the past summer or that raising taxes during an economic downturn could discourage growth.

    Cullerton ruled out overhauling the sales tax to bring in more money. The sales tax now applies only to goods, not services. Cullerton said he would be open to taxing services, but only if the overall tax were lowered so that the overall changes were revenue neutral.

    The last time a major construction program was discussed in Springfield, the money would have come from opening more casinos and privatizing the Illinois lottery.

    Cullerton said that never came close to passing. He said he remains open to the idea but he wants lawmakers to know that vital construction plans can't wait on the longshot possibility of gambling expansion.

    "We've got to move forward with something much more realistic," he said. "I'm making that clear."

    He also said an income tax increase depends largely on Quinn. If the governor supports the idea, it could happen, Cullerton said. If Quinn opposes it, there's little chance that lawmakers would have the votes to approve an increase.

    Quinn has avoided taking a firm position on taxes, whether gasoline or income. He says everything is being considered.

    Cullerton said he supports improving government efficiency, but he rejected the idea that budget cuts can erase much of the deficit. The state controls about $28 billion in its budget, he said, with $14 billion going to health care and $11 billion to education. All other government services account for just $3 billion.

    "We're going to eliminate state government?" Cullerton said. "I think we have to educate people about these numbers, first of all, and then ask them what they want."