The governor cited rising inflation as the basis for creating about $1 billion in temporary tax breaks for fuel, groceries and property taxes.
The fuel tax relief would not lower gasoline prices, but it would prevent a statutory annual fuel tax increase from taking effect this year. It prevents a hike of 2.2 cents per gallon of gasoline, according to the governor’s office — a taxpayer saved him $135 million.
The money from the fuel tax does not go to the general revenue fund, but rather to road construction projects. The tax holiday does not appear to affect a proposed $46.5 billion capital infrastructure budget, which is mostly an extension of Illinois’ 2019 rebuilding plan.
The governor also proposed reducing a 1% state food tax for the fiscal year, a savings to taxpayers set at $360 million. The state would reimburse local authorities for the effect of the tax exemption.
Illinoisans currently eligible for a 5% property tax credit under current law — that is, joint filers earning less than $500,000 and single filers earning less than $250,000 — would be eligible another 5% property tax credit under the proposal, up to $300. Savings to taxpayers are estimated at $475 million.