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Illinois Recoups $100 Million in Unpaid Sales Tax

  • Oct 30, 2014 | Gail Cole

 Illinois is recouping bundles of this from tax evading gas station owners.

If you purchased gasoline in Illinois some time between 2005 and 2011, there is a good chance all or some of the sales tax you thought you paid never found its way to the state. If that seems like an overstatement, consider this data from 2011: “More than one-forth of Illinois gas station operators have underreported the amount of fuel they sell to the public."

In 2008, Illinois Attorney General Lisa Madigan announced a sales tax fraud investigation into gas stations. In August 2010, she shared happy news of the recovery of $12.7 million in unpaid gasoline sales taxes (from 66 gas station owners) and the indictment of six gas station owners and operators for tax evasion. That was just the tip of the proverbial iceberg of Illinois gas station sales tax fraud.

Within the first 18 months, more than 650 alleged gas station tax cheats had been identified by the Illinois Department of Revenue, and a need for stricter enforcement tools emerged. In January 2013, a new law took effect, criminalizing Sales Tax Evasion. It has eliminated barriers to prosecuting business owners and allowed the state to impose stronger penalties. By December 2013, the state had recovered close to $85 million in missing sales tax revenue.

According to the most recent press release from the Office of the Attorney General, the state has now recouped $100 million in unpaid sales tax from gas station owners. Fifty gas station owners have been charged to date; of those, 40 have been convicted. Prison time is being served.

Gas station owners are not the only people guilty of sales tax evasion. The Attorney General’s office has “amassed more than $10 billion in total [sales tax] collections” since Lisa Madigan took office in 2003.

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photo credit: 401(K) 2013 via photopin cc

Sales tax rates, rules, and regulations change frequently. Although we hope you'll find this information helpful, this blog is for informational purposes only and does not provide legal or tax advice.
Gail Cole
Avalara Author
Gail Cole
Gail Cole
Avalara Author Gail Cole
Gail began researching and writing about sales tax in 2012 and has been fascinated with it ever since. She has a penchant for uncovering unusual tax facts, and endeavors to make complex sales tax laws more digestible for both experts and laypeople.