Some of the fun aspects about living in Illinois, especially this time of year, are spending time with family for Christmas, looking back at the year that was, and looking forward to the new year with a renewed sense of optimism and vigor.
Oh, and all the new taxes that usually accompany a new calendar year.
In 2020, the list of new taxes and tax hikes is dizzying. Some are brand new, some are increases on existing taxes, and some are pretty creative ways the state has come up with to dip into our proverbial back pockets and/or purses.
For reasons unknown to me, the state of Illinois has really turned its focus to taxing drivers. Everything from the price of gas we pay at the pump to registering our vehicles to parking said vehicles will see either a new tax or a tax increase beginning next year. In total, there will be 20 new taxes and tax hikes that each of us in Illinois will see hit our collective pocketbooks here in a few weeks.
My purpose isn’t to opine on any of these taxes. They are what they are, and there are too many of them to discuss in detail here.
There are mainly two tax hikes I’d like to talk about in this article, because they are the ones that people seem to be talking about the most.
First is the new vehicle trade-in tax. Currently, when you purchase a car in Peoria County, you pay Illinois sales tax (currently 6.25%) on the difference between the purchase price of the new car and the value of your trade-in. Obviously, this only applies if you have a vehicle to trade in. Let’s take a look at a quick example of how the vehicle trade-in tax works in 2019 and how it’ll work in 2020 and beyond.
Bottom line: If you trade in a car that is valued over $10,000, you’re going to pay more in taxes.
The second tax hike that I’d like to highlight is the gas tax. Now, the first phase of this tax hit on July 1, 2019. The gas tax was doubled from $0.19 to $0.38 per gallon. That’s not the reason I’m including it in this article, though. It’s because it’s scheduled to increase every year through 2025 in direct correlation with the rate of inflation.
I find this type of tax increase fascinating. Mainly because it’s a pretty creative, ongoing tax increase that most of us won’t really even notice. The price of gas changes nearly every day, so many of us probably won’t really know if it’s a tax causing the increase, or the normal day-to-day change in price due to factors only God fully understands.
So there you have it, folks. Let’s all enjoy “lower taxes” here in the state of Illinois while we can. Because in the year 2020 and beyond, we’re gonna fork over even more money to the state government. Especially the Illinoisans who have automobiles.
Happy New Year, everybody! ?
For a complete list of all 9 new tax hikes and/or new taxes click here.