With 5th highest gas tax in the nation, Illinois freezes tax hike until next year

President Biden proposes a federal tax holiday as Illinois' gas tax freeze starts July 1

Photo by lisafx/Depositphotos.com

(CHICAGO) At 39.2 cents per gallon, Illinois has the fifth-highest gas tax in the nation, according to data from the IGEN tax software company. IGEN released a report which breaks down the tax Americans pay on gas by state.

Will the gas tax freeze in Illinois or Biden's recently proposed federal tax holiday provide relief for Illinois drivers?

Pennsylvania has the highest rate

The report shows Pennsylvania has the highest rate at 57.6 cents per gallon, followed by:

• California: 51.1 cents
• Washington: 49.4
• New Jersey: 42.1
• Illinois: 39.2

The lowest tax rate in the nation is Alaska at 8.95 cents per gallon, followed by Hawaii at 16 cents.

Prices are up

Gas prices in Illinois have risen to $5.48 per gallon according to AAA. It's higher than the national average of $4.94.

And it's worse in Chicagoland. The average price for the Chicago Metro area is $5.82 per gallon.

Relief in Chicago

Chicago has tried to help relieve the pressure from high gas prices with its Chicago Moves program, which gives away gas and transit cards to city residents. Here is where you can still apply.

Additionally, mayoral candidate Willie Wilson is planning another gas giveaway in Chicago for July 9.

Illinois gas tax freeze

Amid the high gas prices, Gov. J.B Pritzker included a freeze on the gas tax increase for six months in the Illinois budget. The gas tax in Illinois was scheduled to go up by 2 cents starting July 1.

Now consumers will get a break from this increase until 2023. However, in 2023 it is possible drivers could get hit with two increases; the 2 cents per gallon at the beginning of 2023 and another expected increase on July 1, 2023.

Possible federal gas tax holiday

President Joe Biden is asking Congress for a federal gas tax holiday as he praised states that have already suspended gas taxes.

According to a statement from the White House, "President Biden understands that a gas tax holiday alone will not, on its own, relieve the run up in costs that we’ve seen. But the President believes that at this unique moment when the war in Ukraine is imposing costs on American families, Congress should do what it can to provide working families breathing room."

The federal gas tax holiday would suspend the 18-cent per gallon federal tax for the next three months.

Are the gas tax holidays any help to the average consumer?

Critics argue that gas tax holidays and freezes are a gimmick that do little to help consumers overall.

According to Kiplinger, a person who drives 12,000 miles per year and gets around 25 miles per gallon would save slightly more than $22 during the three-month tax holiday.

If we do the math, in Illinois, a person who drives 12,000 miles per year and gets 25 miles per gallon will save about $4.80 on the six-month freeze of 2 cents per gallon.

To sum it up, the average driver in Illinois might save about $27 total for the Illinois gas tax freeze and the proposed gas tax holiday.

Yes, it is a saving, but not much of one.

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