Moline, IL...State Representative Rich Morthland's (R-Cordova) House Resolution 328 directed the Illinois Commission on Government Forecasting and Accountability to conduct an objective, non-political examination of the State's policy of charging "ad valorem" Illinois sales taxes on motor fuel. This report revealed various factors contributing to the price of gas sold in Illinois.
"Our gasoline sales tax of 6.25% makes Illinois the 3rd highest total tax on fuel in the nation," Morthland said. "This tax has a compounding effect as it increases when gas prices increase. This contributes to flight to Iowa and other states that don't have such a punitive tax structure." Morthland continued, "When we buy our gas in Iowa, it's not uncommon to pick a few groceries or other items there."
The COGFA report speculates that this tax structure has a negative on business in Illinois.
"It's nice to have the income, but it's not necessarily a good dollar in if it's hurting our state and derailing Illinois jobs by pushing sales across state borders," Morthland said. "I am working on a form of tax relief for border communities in Illinois to restore our competitive edge."
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