The Illinois Mileage tracker tax is back. The new proposal includes a provision to have a tracker in applicable vehicles and 1.5 cent per mile tax.

[Q: Good Idea or bad plan?]

Senate Bill 3566 would establish a new Road Usage Charge Program. The per mile charge would require tracking devices to be installed in EV vehicles or self report mileage.

This new 2026 proposal is a different from the per mile/tracker legislation that was proposed in 2025.

The law mandates the new tax would only be applied only to EV vehicles (for now), it would give drivers the option to pay 1.5 cents per mile, or an annual fee of $320 to the state. That fee would be charged on top of Illinois’ standard vehicle registration cost, which is currently $151, meaning EV owners would pay at least $471 per year under today’s rates.

Note: There are no provisions in the legislation to lower gasoline taxes to offset the new revenue the state would receive from EV’s.

State Sen. Ram Villivalam (D‑Chicago), is the same legislator who proposed pilot program that involved vehicle tracking in 2025. Villivalam is same legislator who is proposing this legislation. The 2025 legislation did not pass.

It should also be noted that for the current bill under consideration, effective in 2028, the cost per mile would increase.

Current Status

As of now, Illinois does not impose a mileage tax on drivers. Previous proposals, such as Senate Bill 1938, aimed to create a pilot program to assess a “road usage charge” based on miles driven, but the bill stalled in the General Assembly and was never voted on by the Senate’s transportation committee. Viral claims suggesting a 30-cent-per-mile tax are false; estimates for any potential program were around three to four cents per mile. 

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Purpose of the Proposed Tax

Illinois has one of the highest gas tax rates in the U.S., currently 48.3 cents per gallon, with additional local and municipal taxes bringing the average to 67.1 cents per gallon. With improvements in fuel efficiency and the rise of electric vehicles, revenue from fuel taxes has not kept pace with road maintenance needs. The mileage tax concept is intended to supplement funding for roads and bridges, particularly from vehicles that pay little or no gas tax, such as electric cars. 

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How the Pilot Program Would Work

The proposed pilot program would involve volunteer drivers, potentially around 1,000 participants, who would report mileage to the Illinois Department of Transportation. Reporting could be done via transponders, smartphone apps, or odometer photos. Rates could vary based on roadway usage and time of day, and drivers paying more in gas taxes than the mileage fee would receive a refund. The program would not replace the gas tax but serve as a complementary funding mechanism. 

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Comparisons to Other States

Other states have implemented similar programs:

• Oregon: Drivers pay 2 cents per mile, with registration fee discounts.
• Utah: Electric vehicle drivers pay 1.6 cents per mile, tracked via devices or apps.
• Virginia: Has active mileage-based tax programs for certain vehicles. 2These programs help ensure that all vehicles contribute fairly to road maintenance, regardless of fuel type.

Existing Mileage Weight Tax

Separately, Illinois has a Mileage Weight Tax for commercial and farm vehicles, which adjusts registration fees based on vehicle weight and miles operated. This is not a general driver tax and applies only to vehicles registered under this system, requiring working odometers and surety bonds. 

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Summary

• No statewide mileage tax currently existsfor general drivers in Illinois.
• Proposed legislation explored a pilot program with estimated rates of 3–4 cents per mile.
• The tax is intended to supplement road funding, especially for electric and fuel-efficient vehicles.
• Similar programs exist in other states, but Illinois has not implemented a permanent mileage tax. 3Drivers should continue to pay the existing gas tax and monitor legislative updates for any future pilot programs or changes.

Illinois has one of the highest gas tax rates in the nation, with the state’s per-gallon tax rate on gasoline rising to $0.483 per gallon beginning on July 1.

That rate does not include taxes levied on retailers for petroleum products, along with sales taxes and even municipal tax rates, which are allowed under Illinois law.

When all of that is combined, Illinois drivers pay an average of 67.1 cents per gallon in fuel taxes, trailing only California in that category, according to NerdWallet.

Since those fuel taxes go toward maintaining roads and bridges in the state, it’s imperative that the state raises enough money to help pay for that maintenance. Due to improvements in fuel efficiency and the more widespread adoption of electric vehicles however, those tax revenues have not been going up fast enough to address wear-and-tear on area roadways, leaving states across the country struggling to keep up with maintenance costs, according to the Brookings Institute.

As a result, more states are weighing different options to pay for maintenance, including instituting tolls and charging drivers per mile driven, regardless of the type of vehicle that they are driving.

What’s in Illinois’ version of the mileage tax bill?

The bill in question, Senate Bill 1938, would have created a statewide pilot program to assess user fees for the number of miles traveled on public roadways.

The idea behind the pilot program was to evaluate the “potential for mileage-based revenue as an alternative to the current system of taxing highway use through motor fuel taxes,” according to the text of the legislation.

The program would include at least 1,000 volunteers, and the pilot would be required to last for at least one year. Participants would have received rebates for their motor fuel taxes incurred during the course of the year.

In addition, the per-mile pricing would have varied based on the time of day drivers are using roadways, and what type of roadway they were driving on at a given time.

How would mileage be tracked?

Some critics of mileage taxes have argued that requirements to use electronic tracking devices would violate the civil liberties of drivers, arguing that multiple Constitutional amendments cover such rights.

Illinois’ system would have allowed for drivers to use such electronic devices, but would have also allowed them to explore other tracking means, including taking photos of the odometers in their vehicles.

What is the current status of the legislation?

SB 1938 was first introduced by State Sen. Ram Villivalam in early February, and was referred to the transportation committee during the spring session of the Illinois General Assembly.

A vote on the bill in the committee was postponed in March, and the measure was never brought up for a vote before the end of the session. It was re-referred to the assignments committee on June 2, according to the General Assembly’s website.

How much would Illinois’ tax rate be?

While no specific tax rate was included in the proposed legislation, the expectation is that the Illinois tax rate would be around three-to-four cents per mile driven on state roadways, according to the Chicago Sun-Times.

For context, a driver who racks up 10,000 miles on Illinois roadways under a three-cent tax would pay $300 in taxes for the year. If their vehicle gets 30 miles per gallon on average, they would pay roughly $161 a year in Illinois fuel taxes.

Do any other states have mileage taxes?

According to a 2024 report from the Tax Foundation,several states, including Oregon, Utah, and Virginia have instituted active programs to charge tax per mile.

In Utah, only drivers of electric cars can enroll, paying $0.016 per mile. It’s tracked either via an onboard device or a smartphone app, providing location data.

In Oregon, drivers who sign up for their program pay two cents per mile, but are given a discount on fees paid for their vehicle registrations, saving between $35 and $115 annually, according to officials.

Legislators there are mulling a new bill that would raise the state’s gas tax from 40 cents per gallon to 55 cents per gallon. That would take place over a period of three years.

In addition, the road usage tax would increase to 5% of the state’s gas tax, raising it to 2.75 cents per mile.