OAKBROOK TERRACE, Ill. -- While the federal excise tax on fuel won’t be raised anytime soon, states continue to examine the revenue possibilities during this time of low gasoline prices. Here are some of the latest states to crack open their fuel-tax formula.
- Alabama. According to The Decatur Daily, the chairman of the state legislature’s Joint Transportation Committee believes it is quite possible—up to a “70% chance”--that an increase in the state gas tax will pass to raise revenues for infrastructure construction and repairs.
After a public forum this week, State Representative Mac McCutcheon (R) said he would get a bill prepared in a couple weeks, although he has not yet decided how big of an increase to propose. This was the fifth forum held in the state sponsored by the Alliance for Alabama’s Infrastructure, which advocates for “financially responsible investment” in transportation infrastructure, and includes chambers of commerce, economic development officials and the Business Council of Alabama.
During the forum, several local officials from northern Alabama counties spoke in support of an increase, suggesting amounts ranging from 5 to 12 cents per gallon (CPG).
The state of Alabama last increased the gas tax by 5 CPG in 1992, and it has sat at 16 CPG since then. According to McCutcheon, a 12-CPG increase would capture how high the tax would have risen during those 24 years by inflation, and that the proposal would include annual increases tied to the rate of inflation.
While local officials and Chamber of Commerce representatives were in favor of an increase, the state convenience-store association and a retailer spoke out against it. At the forum, Bart Fletcher, president of the Petroleum & Convenience Marketers of Alabama, said that cities and counties in the state have raised gasoline taxes since 1992, and that a 12-CPG bump would still represent a 66% increase.
Jonathan Edwards, president and CEO of Quick Mart Convenience Stores, which has 15 c-stores in northwest Alabama, told the forum that some of the sites are near the Mississippi and Tennessee state lines, and would take a competitive hit with a gas-tax increase.
“Please don’t kill us,” said Edwards.
- Alaska. The Alaska House Transportation Committee has begun examining—and questioning—Gov. Bill Walker’s proposed gas-tax increase this week, The Fairbanks Daily News-Miner said. The proposal would double the state tax on gasoline from 8 to 16 CPG, double the tax on aviation gasoline and watercraft fuel and nearly triple the tax on jet fuel. It would raise about $49 million for the state, which has been hit hard by a maturing oil industry and the falling price of crude.
Legislators questions how much these tax increases would hurt rural Alaskans. Jerry Burnett, Deputy Commissioner of the Department of Revenue, told the committee that the average driver—someone who drives 20,000 miles annually with an average-fuel-economy vehicle--would be set back around $80 each year.
- Indiana. The Indiana state House passed a bill 62-35 to increase the state’s 18-CPG gas tax by 4 CPG, and to increase its cigarette tax by $1 per pack. To help ease the burden on taxpayers, the bill would cut the state income tax by 5% over eight years, reported The Daily Journal.
Governor Mike Pence (R) opposes the bill. The Senate does have a plan supported by the governor that would set aside some of the state surplus for road repairs as a short-term fix.
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