The Urethane Blog

There are Some States to Avoid

I lived in IL multiple times, but I’m not going back . . . like the rain tax in NJ

EV Owners In Illinois Must Pay $248 A Year To Make Up For Lost Gas Tax Revenue

As if people in Illinois weren’t being taxed enough as a result of the state’s ongoing pension crisis, now electric vehicle owners in the lowest rated state are going to have to pay $248 in annual registration fees next year – $100 more than what owners of gas burning cars pay – according to the Chicago Tribune.

The higher fee is part of the state’s road improvement legislation. The fee is a massive hike from the $17.50 a year that EV owners currently pay, but significantly lower than $1000 fee that lawmakers proposed last month in a bid to compensate for the loss of state gas tax revenue.

Tom Coleman, 69, of Naperville said: “They’ve cut it back from an outrageous number to a more reasonable number. Most EV owners are going to feel a lot better than $1,000, but still upset.”

Of course, just because it’s been postponed does not mean it will not happen, and with the state chronically on the very of insolvency, Illinois will keep on trying to extra a pound, or several hundred gallons, of virtual gasoline from environmentally conscious electric car owners.

As a reminder, over the weekend, the Illinois General Assembly approved the governor’s $45 billion package of transportation infrastructure improvements which boosted things like vehicle registration fees to fund it. The gas tax in Illinois, which is already one of the highest in the United States, will be doubled to $.38 per gallon and the annual registration fee will jump to $148, from $50, for most gas burning vehicles.

And since EVs don’t use gas, EV owners don’t pay any gas tax. This has prompted the state to assess an additional hundred dollars per year to EV owners in lieu of motor fuel taxes. In other words, congratulations EV owners, you’re still paying for gas, even if indirectly.

Hybrids, which still use gas as a supplement to electric power, are not included in the registration surcharge. Legislation introduced last month by Democratic Senator Martin Sandoval of Chicago would have raised the annual EV registration to $1,000. That proposal was met with pushback from EV manufacturers and owners, who called it “unfair” and a “disincentive”.

Companies like Rivian are calling the $248 fee reasonable compared to the initial fee proposed.

Rivian spokesman Michael McHale said: “We appreciate the stance taken by the Illinois legislature on this issue as we continue our build out and investment in the Normal, IL factory that will help increase the numbers of electric vehicles on the roads of Illinois.”

EV sales have been gaining traction over recent years, fueled in part by state and federal incentives. But charging owners more to drive an electric vehicle in Illinois might slow down the momentum for EVs in the state. Illinois ranked seventh in EV sales last year at 6,400 vehicles, and with a total of about 15,000 electric vehicles registered in the state. Coleman received a $7,500 federal tax credit on his $40,000 Chevy Bolt last year. He didn’t get any incentives from Illinois and commented that the $248 fee was fair for the state’s much-needed road repairs.

He stated: “A lot of EV people aren’t going to be happy, although I think we need to do our fair share. These roads really suck around here.”

And we know this idea is completely foreign, but instead of incentivizing and decentivizing over and over, perhaps the state might at some point consider actually allowing the free market to determine what vehicles should wind up on the road. We understand that this plays into legislators’ nightmarish fears of not being able to find things to tax, but we’re sure they’d find something…