Illinois Politics

Illinois' gas tax to rise on July 1. Here's how much you'll pay

The fuel tax increases at the start of the new fiscal year, according to state officials

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Illinois motorists will notice a small increase in their gas prices beginning next month, as the state’s fuel tax will increase by more than 3%.

According to the Illinois Department of Revenue, the tax on gasoline will rise from $0.454 cents per gallon to $0.47, an increase of just over 3.5%.

The taxes on diesel fuel will also rise from $0.529 to $0.545 per gallon, an increase of just over 3%, according to the state’s website.

Since a brief moratorium was placed on the increases amid increases in inflation in recent years, rising twice in in 2023 and now for a third time in July 2024.

According to officials, the state’s tax on fuel is set to increase each year and is indexed for inflation. In 2019, lawmakers voted to make a change to how the tax was figured, allowing it to rise from $0.19 to $0.38 and then to increase each year based on inflation.

The fuel tax is used to fund construction projects at both the state and local levels. Illinois voters added an amendment to the state’s constitution in 2016 to prohibit those revenues for being used for anything other than transportation costs.

Since July 1, 2023, Illinois has collected $2.67 billion in taxes on fuel, according to Illinois State Comptroller Susana Mendoza’s office.

Illinois sales taxes are also applied to fuel, according to officials. Motorists also pay an excise tax on fuel, which is administered by the federal government. Gas is taxed at a rate of $0.184 cents per gallon at the federal level, according to the US Department of Energy.

According to the Tax Foundation, Illinois has the second-highest tax rate on fuel in the country, trailing only California.

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