Illinois Lawmakers May Skyrocket EV Registration Fees to Fund State Infrastructure Projects

The charges are meant to recover gas taxes from EV owners which will then be put toward rebuilding roadways.

Tesla Charging EV Credits
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In an effort to repair Illinois’ aging roadways, state lawmakers have hatched a plan to increase registration fees for owners of electric vehicles by over 400 percent. The Chicago Tribune reported that the state’s plan is meant to recover gas taxes that are lost when “freeloading” EV owners pass up the pump for a charge at home. They currently pay just $17.50 to register their vehicles each year, but the new legislation would raise the annual fee to $1,000.

To be fair, all drivers would feel at least some pain from the proposed law. The state’s gas tax would double to 44 cents per gallon and standard registration fees would increase by $50 to $148. Hybrids and plug-in hybrids would escape the wrath of EV registration fees under the new law, instead falling into the standard vehicle registration fee schedule. The bill, introduced by Democrat Martin Sandoval of Chicago, would bring in an additional $2.4 billion in annual transportation funding.

As anyone could imagine, the proposal has been met with a less than enthusiastic response from EV drivers and manufacturers. Tesla opposes the fee, the Chicago Tribune reports, and Michael McHale, spokesman for the electric truck startup Rivian, said that the new bill “is not only unfair, it discourages promising new technology that will reduce our dependence on petroleum, reduce emissions, and promote the Illinois economy.” Supporters worry that the bill would stifle growth in EV sales, which are propped up (at least partially) by subsidies and tax breaks.

Though they receive an outsized level of media attention, EVs currently only make up 2 percent of the total auto sales volume in the U.S.—just over 200,000 units in 2018. EV buyers get a tax credit that is based on the number of electric vehicles sold by the automaker they choose, topping out at $7,500 and decreasing as manufacturers sell more cars. At the state level, Illinois offers a tax credit of roughly $1,120 per kW. There is no word on whether the new bill would change these state-level credits.