Bill Text: IL HB1221 | 2023-2024 | 103rd General Assembly | Introduced

---

Bill Title: Amends the Motor Fuel Tax Law. Provides that an increase in the rate of tax based on the change in the Consumer Price Index shall not occur until July 1, 2023 (currently, January 1, 2023). Ends a requirement that retailers of motor fuel shall cause a notice to be placed on retail dispensing devices. Effective immediately.

Spectrum: Partisan Bill (Republican 1-0)

Status: (Introduced) 2023-01-31 - Referred to Rules Committee [HB1221 Detail]

Download: Illinois-2023-HB1221-Introduced.html

---

103RD GENERAL ASSEMBLY State of Illinois 2023 and 2024 HB1221 Introduced , by Rep. Amy L. Grant SYNOPSIS AS INTRODUCED:
35 ILCS 505/2 from Ch. 120, par. 418
Amends the Motor Fuel Tax Law. Provides that an increase in the rate of tax based on the change in the Consumer Price Index shall not occur until July 1, 2023 (currently, January 1, 2023). Ends a requirement that retailers of motor fuel shall cause a notice to be placed on retail dispensing devices. Effective immediately.
LRB103 04783 HLH 49793 b
A BILL FOR
HB1221 LRB103 04783 HLH 49793 b
AN ACT concerning revenue.
Be it enacted by the People of the State of Illinois,
represented in the General Assembly:
Section 5. The Motor Fuel Tax Law is amended by changing
Section 2 as follows:
(35 ILCS 505/2) (from Ch. 120, par. 418)
Sec. 2. A tax is imposed on the privilege of operating
motor vehicles upon the public highways and recreational-type
watercraft upon the waters of this State.
(a) Prior to August 1, 1989, the tax is imposed at the rate
of 13 cents per gallon on all motor fuel used in motor vehicles
operating on the public highways and recreational type
watercraft operating upon the waters of this State. Beginning
on August 1, 1989 and until January 1, 1990, the rate of the
tax imposed in this paragraph shall be 16 cents per gallon.
Beginning January 1, 1990 and until July 1, 2019, the rate of
tax imposed in this paragraph, including the tax on compressed
natural gas, shall be 19 cents per gallon. Beginning July 1,
2019 and until July 1, 2020, the rate of tax imposed in this
paragraph shall be 38 cents per gallon. Beginning July 1, 2020
and until July 1, 2021, the rate of tax imposed in this
paragraph shall be 38.7 cents per gallon. Beginning July 1,
2021 and until July 1, 2023 January 1, 2023, the rate of tax

HB1221 - 2 - LRB103 04783 HLH 49793 b
imposed in this paragraph shall be 39.2 cents per gallon. On
January 1, 2023, the rate of tax imposed in this paragraph
shall be increased by an amount equal to the percentage
increase, if any, in the Consumer Price Index for All Urban
Consumers for all items published by the United States
Department of Labor for the 12 months ending in September of
2022. On July 1, 2023, and on July 1 of each subsequent year,
the rate of tax imposed in this paragraph shall be increased by
an amount equal to the percentage increase, if any, in the
Consumer Price Index for All Urban Consumers for all items
published by the United States Department of Labor for the 12
months ending in March of the year in which the increase takes
place. The rate shall be rounded to the nearest one-tenth of
one cent.
(a-5) Beginning on July 1, 2022 and through the effective
date of this amendatory Act of the 103rd General Assembly,
December 31, 2022, each retailer of motor fuel shall cause the
following notice to be posted in a prominently visible place
on each retail dispensing device that is used to dispense
motor fuel in the State of Illinois: "As of July 1, 2022, the
State of Illinois has suspended the inflation adjustment to
the motor fuel tax through December 31, 2022. The price on this
pump should reflect the suspension of the tax increase." The
notice shall be printed in bold print on a sign that is no
smaller than 4 inches by 8 inches. The sign shall be clearly
visible to customers. Any retailer who fails to post or

HB1221 - 3 - LRB103 04783 HLH 49793 b
maintain a required sign through the effective date of this
amendatory Act of the 103rd General Assembly December 31, 2022
is guilty of a petty offense for which the fine shall be $500
per day per each retail premises where a violation occurs.
(b) Until July 1, 2019, the tax on the privilege of
operating motor vehicles which use diesel fuel, liquefied
natural gas, or propane shall be the rate according to
paragraph (a) plus an additional 2 1/2 cents per gallon.
Beginning July 1, 2019, the tax on the privilege of operating
motor vehicles which use diesel fuel, liquefied natural gas,
or propane shall be the rate according to subsection (a) plus
an additional 7.5 cents per gallon. "Diesel fuel" is defined
as any product intended for use or offered for sale as a fuel
for engines in which the fuel is injected into the combustion
chamber and ignited by pressure without electric spark.
(c) A tax is imposed upon the privilege of engaging in the
business of selling motor fuel as a retailer or reseller on all
motor fuel used in motor vehicles operating on the public
highways and recreational type watercraft operating upon the
waters of this State: (1) at the rate of 3 cents per gallon on
motor fuel owned or possessed by such retailer or reseller at
12:01 a.m. on August 1, 1989; and (2) at the rate of 3 cents
per gallon on motor fuel owned or possessed by such retailer or
reseller at 12:01 A.M. on January 1, 1990.
Retailers and resellers who are subject to this additional
tax shall be required to inventory such motor fuel and pay this

HB1221 - 4 - LRB103 04783 HLH 49793 b
additional tax in a manner prescribed by the Department of
Revenue.
The tax imposed in this paragraph (c) shall be in addition
to all other taxes imposed by the State of Illinois or any unit
of local government in this State.
(d) Except as provided in Section 2a, the collection of a
tax based on gallonage of gasoline used for the propulsion of
any aircraft is prohibited on and after October 1, 1979, and
the collection of a tax based on gallonage of special fuel used
for the propulsion of any aircraft is prohibited on and after
December 1, 2019.
(e) The collection of a tax, based on gallonage of all
products commonly or commercially known or sold as 1-K
kerosene, regardless of its classification or uses, is
prohibited (i) on and after July 1, 1992 until December 31,
1999, except when the 1-K kerosene is either: (1) delivered
into bulk storage facilities of a bulk user, or (2) delivered
directly into the fuel supply tanks of motor vehicles and (ii)
on and after January 1, 2000. Beginning on January 1, 2000, the
collection of a tax, based on gallonage of all products
commonly or commercially known or sold as 1-K kerosene,
regardless of its classification or uses, is prohibited except
when the 1-K kerosene is delivered directly into a storage
tank that is located at a facility that has withdrawal
facilities that are readily accessible to and are capable of
dispensing 1-K kerosene into the fuel supply tanks of motor

HB1221 - 5 - LRB103 04783 HLH 49793 b
vehicles. For purposes of this subsection (e), a facility is
considered to have withdrawal facilities that are not "readily
accessible to and capable of dispensing 1-K kerosene into the
fuel supply tanks of motor vehicles" only if the 1-K kerosene
is delivered from: (i) a dispenser hose that is short enough so
that it will not reach the fuel supply tank of a motor vehicle
or (ii) a dispenser that is enclosed by a fence or other
physical barrier so that a vehicle cannot pull alongside the
dispenser to permit fueling.
Any person who sells or uses 1-K kerosene for use in motor
vehicles upon which the tax imposed by this Law has not been
paid shall be liable for any tax due on the sales or use of 1-K
kerosene.
(Source: P.A. 101-10, eff. 6-5-19; 101-32, eff. 6-28-19;
101-604, eff. 12-13-19; 102-700, eff. 4-19-22.)
Section 99. Effective date. This Act takes effect upon
becoming law.