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Gas tax hike hidden in state budget package

A 20 percent tax credit given to ethanol wholesalers has now been eliminated under the new budget package. (WRSP)

Inside the budget package that just passed is a gas tax hike for Illinoisans.

Here in central Illinois, it looks like we’ll be paying about 3 to 5 cents more per gallon.

A 20 percent tax credit given to ethanol wholesalers has now been eliminated under the new budget package.

This cost will now fall on consumers.

"As the wholesales go up, the sales tax will go up and the price will go up," said Bill Fleischli, executive vice president of the Illinois Petroleum Marketers Association.

"I don't know why they're wanting to keep taxing gas and making it go higher for us," Riverton resident Tammy Muchorski said.

University of Illinois Springfield student Katelyn Michl isn't happy about the increase.

She said affording gas at the price it's at now is tough enough.

"Adding taxes is going to make it harder for people my age and older people to do different things," Michl said.

According to Fleischli, Illinois sells about 5 billion gallons of motor fuel a year.

Every time the price per gallon increases by a penny, he said roughly $50 million is brought in.

"A gasoline retailer knows what a penny is worth, and it's upsetting to them that they're going to have this tax,” Fleischli said.

If prices stay where they are now, this tax should bring in at least $150 million a year.

Because this is a sales tax, not a gas tax, the money goes into the general fund. It won't be used for road repairs unless the General Assemble appropriates the monies toward that.

The tax hike hasn't gone into effect yet.

Fleischli said he's working with the department of revenue now to find out an exact date it'll start.

He said stations around the state are already working out details to implement the new system.

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