Effort to offer sales tax holiday on fuel dies in Illinois

| 5/16/2006

A bill died in the Illinois House that sought to offer truckers and other drivers a four-month price break at the fuel pump.

The bill remained in the House Rules Committee when the regular legislative session ended this month, effectively killing it for the year.

Sponsored by Rep. Bill Black, R-Danville, the measure called for a sales tax holiday on motor fuels sold in the state between May 15 and Sept. 15.

Consumers now pay a 6.25 percent sales tax on motor fuel pumped into their tanks; 5 percent goes to the state with the rest earmarked for local governments. The bill – HB5785 – called for the state portion of the tax to be temporarily eliminated.

Illinois is one of nine states to apply a general sales tax on fuel in addition to a per-gallon state tax.

Black said because fuel prices are soaring, the state’s revenue from that sales tax is significantly higher than had been expected. Opponents said that instead of cutting into the sales tax the state should focus on gouging by refiners and marketers.

A similar effort offered by Black also died in committee.

The bill – HB4366 – called for a holiday from paying 5 percent of the sales tax on fuel. The moratorium would have lasted for the month of May.