Staying up-to-date on changes in state tax laws can be tricky, but is certainly helpful when it comes to protecting your best interest as a taxpayer. Significant changes, no matter how minor, have the power to seriously impact your wallet and your lifestyle. Whether you are working to manage your personal finances or keep your small business in check, every dollar counts.
One recent development that could potentially affect Illinois drivers and their money is a newly proposed tax that would tax motorists according to the distance they drive. Proposed by Senate President John Cullerton, this tax concept stems from the need for various road repairs throughout the state and the drop in gasoline tax revenue, an inevitable result of having more eco-friendly cars on the roads.
Legislators are hoping the funds will go toward the much needed repairs, replacing the existing tax on gas for state residents. Cullerton’s stance is that although eco-friendly cars offer better mileage, they still contribute the same wear and tear on Illinois roadways. Money for road repair needs to come from somewhere, and state taxpayers are first on deck.
How Will the Per-Mile Tax Impact Me?
For starters, residents can expect to pay 1.5 cents per mile driven. Additionally, the method in which a driver’s distance would be measured would entail a device of some sort that tracks the number of miles they put on their car. Drivers would have a choice in how they pay the tax, however. They can either choose to have a device in their car, which would monitor their distance in one of two ways (via odometer readings or location-specific readings), or they would simply pay the 1.5-cent-per-mile tax, based on 30,000 miles traveled each year.
Cullerton explained that Illinois drivers would receive refunds for any gasoline tax costs paid at the pump, and that under his plan, those who drive gas-guzzling vehicles will likely pay less overall due to the fact that the 1.5 cents per mile would be less than the driver’s gasoline taxes. This would in turn affect drivers of eco-friendly cars, resulting in higher taxes for those who choose efficient vehicles. Despite this, Cullerton added that the hike in taxes for eco-friendly drivers would not necessarily mean a huge change, being that they already pay much less in gas costs than other drivers.
Preparing for the Tax Change
As of right now, the law is tentatively set to go into effect in 2025, so Illinois drivers have some time to prepare and adjust. Wherever you fall on the driving spectrum, you can benefit from speaking with a knowledgeable Cook County tax attorney who can assist with any questions you might have about this potential tax, as well as any other tax concerns. Call the Law Offices of Eric G. Zelazny today at 708-888-2299 for a special consultation.