Owners of all-electric vehicles in Illinois may soon have to pay a proposed $1,000 annual registration fee. This increase would be used to help fund $2.4 billion in projects such as road improvements in the state. As the reasoning goes, electric vehicle owners don’t pay a gas tax, so the jump in the electric vehicle registration would make those car owners pay their fair share. Those who drive hybrids and plug-in electric hybrids wouldn’t have to pay the higher registration fee, since they use gasoline.
The proposed hike is more than 57 times the current yearly fee of $17.50 for electric vehicle owners in the state. In 2018, 6,400 electric vehicles were sold in Illinois, the seventh largest amount for a single state that year. Some of those owners are now saying that had they known about the potential massive registration hike, they wouldn’t have purchased their vehicles.
Sales of electric vehicles reached higher than 200,000 last year in the United States, accounting for about 2 percent of all sales. According to a JPMorgan analysis, electric vehicle sales will make up 38 percent of all vehicle sales in the U.S. by 2025.
Some Tesla owners in Illinois have received $7,500 in federal incentives and $4,000 in state ones for buying their electric cars. However, once a car manufacturer delivers 200,000 vehicles the federal incentive drops by 50 percent. Tesla has already hit this limit. A spokeswoman for Tesla said that the company does not support Illinois’ electric vehicle registration increase.
The state’s owners of gas-fueled vehicles will now escape unscathed by the legislation. The proposed bill also targets the cost of a standard vehicle’s registration with an increase from $98 to $148. The state’s gas tax would also increase, rising from 19 cents a gallon to 44 cents. This would give Illinois the highest gas tax in the country, surpassing Pennsylvania, the current holder of the record.
Chicago state Sen. Martin Sandoval, a Democrat, introduced the legislation earlier this week. The bill has already passed the Illinois House Revenue & Finance Committee in a 9-6 vote.