Gas, FanDuel, Zyn, AT&T, VRBO: 5 new taxes hitting Illinoisans July 1

Gov. J.B. Pritzker signed a $55.2 billion budget propped up by five new tax hikes starting July 1. Gas, phone bills, tobacco, sportsbooks and rentals such as VRBO will all come with higher taxes in Illinois.

Lawmakers approved a series of tax hikes described as ”smart new sources of revenue,” but will look like the same-old government hand reaching into your wallet when you start paying them July 1.

Here’s a look at Illinois’ five newest taxes.

Most notable is the gas tax, set to rise to 48.3 cents per gallon. The state gas tax was 19 cents before Gov. J.B. Pritzker doubled it in 2019. State lawmakers also agreed the tax would automatically rise with inflation each July 1, shielding them from responsibility for the increases. It now takes an extra $143 annually from each Illinois driver.

Lawmakers also introduced a 25-cent tax on all sports bets in the state, which doubles to 50 cents if a sportsbooks gets more than 20 million wagers. FanDuel and DraftKings both are well above that volume and announced they will implement 50-cent fees per wager on Illinois customers in response to the tax.

Taxes on tobacco products, including nicotine pouches, will go from 36% to 45% of the wholesale price. This excludes nicotine products designed to help individuals quit smoking.

Your phone bill is going up, too. The telecommunication tax is increasing from 7% to 8.65% to fund the 988 hotline for suicide and crisis prevention services.

Illinois on July 1 starts charging short-term rentals the state’s 6% hotel tax. Airbnb’s already been voluntarily paying it, but now VRBO and others will have to chip in.

July marks a new fiscal year for the state, but the spending habits from lawmakers is more of the same: another year of lawmakers figuring out ways to get into taxpayers’ pockets so they can spend a record $55.2 billion instead of pursuing real reforms to fix pensions, cut spending and improve Illinois’ tax climate.