CHICAGO (June 30, 2025) –  Illinois’ second-highest in the nation gas taxes will rise again tomorrow as the state motor fuel tax hits 48.3 cents per gallon.

That means the average driver in Illinois will pay $143 more in state gas taxes annually compared to before Gov. J.B. Pritzker doubled the tax in 2019, according to the Illinois Policy Institute.

In total, when combined with existing federal, state and local fuel taxes, Illinois’ gas tax burden can reach up to 85 cents per gallon. Drivers in Chicago pay even more, with an additional 8 cents in city tax and 3 cents from Cook County, along with added sales taxes for each.

“With a record 3.86 million Illinoisans expected to hit the roads this summer, another gas hike is painful – especially considering this increase happens automatically every year without lawmakers even voting on it,” said Bryce Hill, director of fiscal and economic analysis at the nonpartisan Illinois Policy Institute.

In Chicago, the city’s higher minimum wage will also take effect July 1, increasing to $16.60 per hour and tipped workers rising to $12.62 per hour. Those government mandates hurt job creation, cost consumers and threaten businesses’ survival.

“We’re hurting our workers – especially on top of all the other taxes and fees the state imposes, making Illinois more and more expensive for working families. By eliminating the tip credit, lawmakers are forcing businesses to make impossible choices: raise prices, cut hours, or close entirely,” Hill said.

Other new state tax increases taking effect July 1 include:

• A 25-cent tax on the first 20 million sports wagers made within the state and a 50-cent tax on all wagers made thereafter. The added fees will mostly hit FanDuel and DraftKings, which each get roughly 300 million bets a year, but competitors such as BetMGM and Caesar’s are right on the line.
• An additional 6% tax on Airbnb, Vrbo, and other short-term rentals in Illinois.
• A tax increase from 36% to 45% on the wholesale price of tobacco products – including vapes, nicotine gum and chewing tobacco.
• A tax increase from 7% to 8.65% on phone and internet services affecting cell phones, messaging and other telecom services.

To read more about Illinois’ gas tax increases, visit illin.is/independencegas.

For interviews or interviews, contact media@illinoispolicy.org or (312) 607-4977.