Illinois Diesel Policy Could Surprise Truckers

Illinois has implemented measures to lower diesel fuel prices, but industry stakeholders fear it could lead to increased costs.

The state's governor, J.B. Pritzker, issued an executive order suspending penalties for the expanded use of red-dyed diesel, a fuel intended for off-road vehicles like farming and construction equipment. This action is part of a broader effort to alleviate the impact of rising fuel prices, which have significantly affected farmers and transportation companies.

Red-dyed diesel has specific tax regulations, and improper use can result in tax penalties. Although the Illinois order defers certain penalties through the end of the year, the taxes themselves have not been eliminated. This raises concerns for truckers, especially those operating across state lines where different regulations may apply.

The Illinois Department of Revenue is expected to clarify the tax rules. The Mid-West Truckers Association has advised its members to refrain from using red-dyed fuel until these regulations are fully understood, citing potential complications from residue in fuel tanks and varying state tax laws.