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Committee approves temporary gas tax cap resolution effective June 1 to March 1, 2027
Summary
Legislators approved a resolution electing a cents-per-gallon tax method that caps the taxable price at $3.00 from June 1, 2026 through March 1, 2027; the committee was told the change could return an estimated $3.3 million to residents over nine months at an assumed $4.00 pump price.
The Rules Committee approved a resolution electing a cents-per-gallon rate for sales and compensating use taxes on motor fuel and diesel to effectively cap the taxable price at $3.00 per gallon from June 1, 2026 through March 1, 2027. Legislator Stephen R. Hunter presented the resolution and described its intent to provide relief while maintaining budgetary prudence; the motion carried without recorded opposition.
Hunter said the cap would prevent price-driven tax collection on the portion of the pump price above $3.00 and stressed regional competition, noting neighboring counties had already enacted similar caps. "We are essentially not collecting the tax on the portion of the price that has been recently driven up due to the current fuel situation that we all hope is temporary," Hunter said, pointing to a Commissioner of Finance analysis estimating roughly $3.3 million in reduced collections returned to residents and businesses over the nine-month period at an assumed $4.00 average pump price. Legislative Counsel Betsy N. Abraham said enforcement of the tax election occurs at the State level and that she has coordinated with the Department of Taxation and Finance to seek necessary waivers to enable a June 1 effective date.
