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Illinois Raises Motor Fuel Tax by 2.7% Starting July 1

The inflation-linked increase under a 2019 law earmarks all new transportation revenue for highways and transit in the FY 2026 budget

A customer holds a fuel nozzle at a Chevron gas station in San Francisco, California, US, on Friday, June 7, 2024. Photographer: David Paul Morris/Bloomberg via Getty Images
Refillable vapes are available for sale at Mr. Vape & Smoke in Chicago’s Lincoln Park neighborhood on June 18, 2025. (Chris Sweda/Chicago Tribune)
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Overview

  • The 2019 legislation doubled Illinois’s base motor fuel tax and mandated annual CPI-linked hikes each July 1.
  • For fiscal year 2026, the gasoline tax rises by 1.3 cents to $0.483 per gallon and diesel climbs to $0.558 per gallon.
  • CPI-based increases add roughly $6 in annual fuel costs for the average driver, equating to about 18 cents more per gallon for a 14-gallon fill-up.
  • Under the constitutional Transportation Taxes and Fees Lockbox Amendment, 80% of new revenue funds state highways and 20% supports local transit and infrastructure.
  • Including federal and local levies, Illinois now has the second-highest fuel tax rate in the nation, trailing only California.