Why Are Gas Prices the Highest in Illinois Compared to the Rest of the Midwest?
Traditional motor fuel taxes are a fixed amount per gallon. These federal and state taxes generally pay for road maintenance and other transportation expenses – motorists in all states pay these taxes.
Illinois, however, is one of only seven states that tack on additional gas taxes beyond the motor fuel taxes. But most consumers don’t realize that, because these costs don’t show up on their receipts, they’re built into the price.
Breakdown of Taxes Per Gallon in Chicago (as of Aug. 17)
- Total taxes per gallon: $0.77
- Federal and state excise taxes: $0.37
- Remaining $0.40 includes:
- Illinois’ 6.25% sales tax: adds $0.18 per gallon
- County and city sales taxes: add $0.11 per gallon
- Illinois environmental tax
- Additional county and home-rule sales taxes
- Regional transportation authority taxes
Frequently Asked Questions
Why are gas prices in Illinois higher than in neighboring Midwest states?
Illinois adds more layers of taxes to gasoline than neighboring states. Beyond standard federal and state excise taxes, Illinois imposes additional sales taxes, environmental taxes, and regional transportation taxes, which together significantly raise the total cost per gallon.
How much do taxes add to the price of a gallon of gas in Chicago?
As of August 17, the total taxes per gallon of gas in Chicago amount to $0.77. This includes $0.37 in federal and state excise taxes and an additional $0.40 from state sales tax, county and city taxes, environmental taxes, and transportation authority fees.
Are the extra taxes on Illinois gas visible on my receipt?
No, most of the additional taxes in Illinois are not itemized on your receipt. They are built into the price you see at the pump, which makes it harder for consumers to recognize how much tax they are paying.
What is Illinois’ state sales tax rate on gasoline?
Illinois applies a 6.25% sales tax to gasoline, which, depending on the price per gallon, adds approximately $0.18 to each gallon purchased.
How do Illinois’ gas taxes compare to other states?
Illinois is one of only seven states that impose sales tax on gasoline in addition to standard motor fuel taxes. This layered approach results in Illinois having some of the highest gas taxes and thus some of the highest prices in the Midwest.