If you’ve driven across the border from St. Louis into Illinois or crossed into the state from Wisconsin, you’ve likely felt the immediate, painful sting of a price hike at the pump. As of mid-February 2026, the national average for a gallon of regular unleaded is hovering around $2.92, but Illinois remains a stubborn outlier. Several data points push the state’s average closer to $3.01, while neighboring states like Missouri and Iowa have prices as low as $2.53 recently. It’s a persistent issue for Illinois drivers.
This pricing disparity isn’t just a fluke of the market or a result of you visiting a station with unusually high gas prices. It is the result of a complex, layered system of taxation and regulation that makes Illinois one of the most expensive places in the Midwest to fuel up. Here’s what’s going on in Illinois – not just Chicago.
The automatic annual excise tax increase
Illinois residents are currently dealing with a gas tax structure that is designed to go up, and only up. In 2019, the state’s motor fuel tax doubled to 38 cents per gallon; the real kicker was a provision that ties future tax increases to the Consumer Price Index. As of January 1, 2026, the gas excise tax sits at roughly 48 cents per gallon, a figure that automatically adjusts every July 1st without requiring a new vote from the legislature.
This approach to taxation means that even when global oil prices stabilize, Illinois drivers face a rising floor for what they pay. While neighboring states like Missouri and Indiana have also adjusted their taxes to fund infrastructure, neither raises prices as high or as often as Illinois. This predictable upward trend ensures that Illinois remains among the three most-taxed states for fuel in the nation.
Illinois taxes its taxes
Unlike most states that charge a flat excise tax per gallon, Illinois is one of only a handful of states that apply a percentage-based sales tax on top of the fuel price. This creates a “tax on a tax” situation where the state’s 6.25% sales tax is calculated after federal and state excise taxes have already been added to the base cost of the gasoline. When gas prices rise globally, the amount of sales tax you pay in Illinois increases proportionally, compounding the pain at the pump…