Are You Ready to be Taxed by Miles Driven in Illinois?

The theory goes like this: If you want less of something – then you tax it. If you want more of something – then you subsidize it. In Illinois gas taxes are 2^nd in the nation behind only California. With those elevated fuel taxes, Illinois drivers are buying more fuel efficient cars, or electric cars. That has created lessening fuel taxes in the Prairie state. But there’s a new old idea kicking around Springfield on taxing drivers.

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Springfield is considering taxing Illinois drivers on the miles they drive instead of taxing the fuel they use. The auto industry has gotten better at fuel efficiency so you can drive further on a gallon of gas now compared to decades ago. There are also hybrid and full on electric vehicles using the roads using even less fuel or no fuel at all.

To achieve this mileage taxation the state will have to either track your vehicle via downloaded software or something like some insurance companies use that plugs into your cars computer system. The state could also just have you at tax time fill in a mileage form for distance driven in state over the year? Do you think the state trusts you to get that correct? What if you live near a state border and drive in both?

Legislators point towards the toll road system as one that could keep Illinois roads and bridges up to speed and smooth. On Illinois toll roads the rate is approximately 7 cents per mile. The mileage tax plan supposes that the fee would be closer to 4 or 5 cents per mile.

Other states are further down this road (no pun intended). Oregon and Utah are already rolling with it. California and Pennsylvania are trying it on a limited basis. Interestingly Illinois believes that the mileage tax wouldn’t raise enough to remove the fuel tax. Surprise, it won’t be an either -or situation, but both in Illinois. This idea has been floated at the federal level too by the Transportation committee, but hasn’t been implemented as it polled poorly.