Georgia, other states, pursue fuel tax relief

By Keith Goble
state legislative editor

With fuel prices breaking all records this summer - even before Hurricane Katrina added to the nation’s fuel crisis - state lawmakers across the country are grasping for opportunities to score easy political points with constituents by proposing tax relief.

Truckers and other drivers in Georgia paid less at the pump for most of September, thanks to a moratorium on the state’s 7.5-cent-per-gallon tax on gasoline and diesel fuel. The order included a suspension of the state’s 4 percent sales tax on fuel.

Gov. Sonny Perdue called for the breaks. The Georgia General Assembly and governor then acted to temporarily remove the IFTA obligation on miles truckers traveled in Georgia so they wouldn’t be left holding the IFTA bag at the end of the quarter.

“I believe it’s absolutely wrong for the state to reap a tax windfall from this tragedy,” Perdue said, adding that the goal of the moratorium was to “keep that money in the pockets of Georgia motorists.”

He said the state would forfeit about $75 million in tax revenue.

Georgia lawmakers were not alone in their attempts to relieve the burden of higher prices at the pump. State officials throughout the country are looking at ways to save consumers money. Here is a sampling of what Land Line found.

Republicans in the Wisconsin Assembly have called on Democratic Gov. Jim Doyle to grant a slight reprieve from high fuel prices in the state.

Representatives Robin Vos, Pat Strachota and Don Pridemore want to give residents in the state a fuel tax holiday for the rest of the year.

A similar plan was implemented last year in Florida. Lawmakers cut the state’s gasoline tax by 8 cents per gallon for the month of August, saving motorists there $59.7 million.

Wisconsin’s GOP lawmakers want to cut the state’s tax on diesel and gasoline by 15 cents per gallon through the end of the year.

“I can’t control OPEC, I can’t control crude oil output in the Gulf, but I can work with my colleagues to try to help people who need help right now with gas prices that are going through the roof,” Vos, of Caledonia, told Land Line.

The Wisconsin governor, however, is pushing an alternative to ease the burden on consumers. The measure is stalled in the Assembly judiciary panel. It would repeal the state’s minimum markup requirement for diesel and gasoline.

The rule has been in place since the 1930s.

AB505, sponsored by Assemblyman Jeffrey Wood, R-Chippewa Falls, would strike provisions in state law requiring markups of 3 percent for wholesalers and 6 percent for retailers.

If signed into law, the governor’s office said fuel prices would drop about 9 cents “virtually overnight.”

A law that took effect Sept. 1 in Hawaii limits the wholesale price of gasoline, making it the first state in the nation to cap prices. The price-cap formula - which does not apply to diesel fuel - is intended to ease Hawaii’s inflated gas prices by tying the prices to a weekly national average instead of a West Coast benchmark.

New Jersey
Legislators from both sides of the aisle in New Jersey are looking to curb the tide of rising fuel prices.

Assemblyman Jeff Van Drew, D-Cape May, said he is considering legislation that would mimic Hawaii’s price cap - and include diesel fuel.

Van Drew is not alone in his pursuit of rescuing beleaguered drivers.

Assemblyman Francis Bodine, R-Moorestown, said he plans to introduce a bill once lawmakers head back to the capitol in November that would bar anyone from selling fuel for more than 10 percent above its cost.

Democrats in the Missouri House were unsuccessful in getting Gov. Matt Blunt to expand the agenda of the recently completed special session to include a two-week fuel tax holiday.

The proposed tax holiday would cut Missouri’s 17-cent-per-gallon tax on diesel and gasoline to 7 cents per gallon.

“I’m just like everybody else,” said House Minority Leader Jeff Harris, D-Columbia. “I’m tired of paying high gas prices. This is a way to give consumers, businesses and truckers immediate relief at the pump.”

Harris said the direct revenue loss from the tax holiday would be about $18 million.

Blunt, a Republican, doesn’t appear too keen on the idea. Jessica Robinson, a spokeswoman for the governor, told the Columbia Daily Tribune the proposal is a “risky scheme.”

Despite the governor’s refusal to allow lawmakers to consider the proposed tax holiday, Harris said he would consider bringing the matter up again when lawmakers return to the capitol for the regular session that begins in January.

Responding pressure from Pennsylvania residents about rising fuel costs, Gov. Ed Rendell said he might ask state lawmakers to temporarily lift the state’s per-gallon fuel tax.

A loss of tax revenue wouldn’t come without a cost, Rendell said.

“There’s a price that we pay if we do that,” Rendell told news reporters. He said it would “take a big hunk” out of the $2 billion the tax generates each year for road and bridgework throughout the state.

In Michigan, state Rep. Robert Gosselin, proposed a measure to drop the state’s sales tax on gasoline - but only after a certain point.

The bill - HB4841 - would drop the 6 percent sales tax if the price pushes above $2.30 per gallon for regular unleaded.

However, Gosselin, R-Troy, said the move would save motorists only a few cents per gallon.

According to The Detroit News, the tax would cost Michigan $3 million a year in sales tax revenue for every penny that gas prices rise above $2.30.