Chris Lieberman, FISM News
On Friday, Georgia Governor Brian Kemp (R) signed a bill temporarily suspending Georgia’s state gas tax in an attempt to combat rising fuel prices.
House Bill 304, which passed unanimously through both chambers of Georgia’s General Assembly, pauses the collection of Georgia’s 29.1 cents per gallon state tax on gas from now until the end of May. The bill also suspends Georgia’s 32.6 cents per gallon tax on diesel fuel.
“Though we can’t fix everything Washington has broken, we’re doing our part to lessen the impact on Georgians’ wallets,” said Kemp on Twitter.
In the coming days, the suspension of the 29.1 cent tax on motor fuel and 32.6 cent tax on diesel will make its way to the consumer.
Though we can't fix everything Washington has broken, we're doing our part to lessen the impact on Georgians' wallets. pic.twitter.com/LfYE5HYN0T
— Governor Brian P. Kemp (@GovKemp) March 18, 2022
Gas prices in the Peach State on Monday were $4.12, down 15 cents from a week ago according to AAA, which tracks gas prices across the country. However, it may take some time to see the full impact of the bill, as gas stations are still distributing fuel that was purchased while the gas tax was still in place.
Georgia’s bill could cost the state about $400 million dollars in lost revenue that would have been used for roads and other transportation projects, according to Fox Business. Kemp said that he plans to use part of the state’s $1.25 billion in budget surplus from last year to fill in any gaps in transportation funding.
Georgia’s law comes after Maryland Governor Larry Hogan (R) also signed a bill on Friday putting a 30-day pause on his state’s 36.9 cents per gallon gas tax. “This is, of course, not a cure-all, and market instability will continue to lead to fluctuations in prices, but we will continue to use every tool at our disposal to provide relief for Marylanders,” said Hogan on Friday.
Governors and lawmakers in other states, including Illinois, Massachusetts, Maine, Michigan, Minnesota, New York, and Tennessee are also considering canceling gas taxes in their own states, while California Gov. Gavin Newsom (D) is proposing tax rebates as a way to help offset rising fuel costs. Meanwhile, six Democratic governors from Colorado, Michigan, Minnesota, New Mexico, Pennsylvania, and Wisconsin wrote to Congress last week calling for a halt on the federal gas tax, which is 18.4 cents per gallon.
While gas tax suspension bills have received broad bipartisan support, some critics warn that they will do little to help consumers and may enable gas companies to raise prices, all while taking critical money from state budgets. “The savings are going to be so minimal for everyday Americans,” said Lucy Dadayan, senior research associate at the Urban Institute, a think tank based in Washington.
“It’s much, much more reasonable to give rebates to the lowest-income taxpayers,” Dadayan told CNN. “But eliminating or temporarily suspending gas taxes is not a prudent tax policy.”
Gas prices, which had already been rising steadily, surged following Russia’s invasion of Ukraine last month. Prices reached their peak on March 11, with the national average hitting $4.33 per gallon, but have seen a modest drop since. As of Tuesday, the national average is at $4.24 per gallon.