Biofuels Tax Exemption

Sales and use taxes apply to 80% of the proceeds from the sale of fuel blends containing between 1% and 10% biodiesel and the sale of fuels containing 10% ethanol (E10) made between July 1, 2003, and July 1, 2017. If at any time these taxes are imposed at a rate of 1.25%, the tax on biodiesel blends and E10 will apply to 100% of the proceeds of sales. These taxes do not apply to the proceeds from the sale of biodiesel blends containing more than 10% biodiesel up to 99% biodiesel or fuels containing between 70% and 90% ethanol (E70-E90) sold between July 1, 2003, and December 31, 2023. Taxes will apply to 100% of the proceeds from biodiesel and ethanol fuel blend sales made after December 31, 2023. (Reference Senate Bill 9, 2017, and 35 Illinois Compiled Statutes 120/2-10, 105/3-10, and 105/3-44)

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