(Editor's note: This article was published first at Illinois Policy Institute)
President Biden is calling for a three-month suspension of federal taxes on gasoline and diesel, but Congress first needs to pass a suspension of the 18.4-cents-a-gallon federal gasoline tax and 24.4-cents-a-gallon diesel tax.
In Illinois, gas taxes are an election-year gimmick. Gov. J.B. Pritzker delayed until after the election the July 1 automatic gas tax hike – a mechanism that lets state lawmakers escape unpopular tax votes and that Pritzker approved in 2019 when he doubled the gas tax to 38 from 19 cents per gallon.
Biden’s announcement comes days after new records for the average price of gas and diesel nationwide, according to AAA. The U.S. average June 23 was $4.94, Illinois was $5.48 and Chicago was $6.01.
Illinois’ state motor fuel tax, currently 39.2 cents a gallon, is more than twice the federal tax and twice what it was before Pritzker took office. After Pritzker’s delay in the July 1 automatic hike, there will be two hikes in 2023 – the delayed one on Jan. 1 and the regular hike on July 1 – when the tax is expected to hit 45.2 cents per gallon.
Other states have created actual motor fuel tax holidays, as Biden proposes, rather than delaying the next increase, as Pritzker is doing. Connecticut suspended its 25-cent-a-gallon tax in April.
Illinois is especially ripe for gas tax relief because Illinoisans pay the second-highest gas taxes in the nation.
Pritzker took such pride in the delay that he’s forcing gas stations to advertise it or pay $500-a-day fines if they don’t comply. In defense of their free speech, station owners took Pritzker to court and created their own version of his sign that tells the full story about gas taxes doubling in Illinois under Pritzker. The sign includes a QR code that takes drivers to the Illinois Policy Institute’s gas tax calculator so they can see how much of their fill-up goes to taxes.
Illinoisans could benefit from a real tax holiday, but permanently ending the automatic annual motor fuel tax hikes would go farther in offering relief at the pump.
Drivers headed to their polling places Nov. 8 should also remember this: The same government union leaders who pushed for the doubled state gas tax and annual gas tax hikes are now pushing a constitutional amendment. Amendment 1, masquerading as a “workers rights amendment,” would guarantee a $2,100 property tax hike for the typical Illinois homeowner.