Several states in the U.S. are taking steps to roll back taxes on gasoline, a move being considered for backing at the federal level by the Biden administration even as the fuel prices surged crossed $4 per gallon.
The tax-cut on gasoline
As per Bloomberg News, Tuesday is scheduled to see a hearing by the Maryland Lawmakers on a proposed bill that seeks to suspend around 37 cents of taxes per gallon for 30 days. The move has Larry Hogan, Governor of Maryland, and if the bill is fast-tracked, the suspension would take effect as early as Thursday.
Brian Kemp, Governor of Georgia, has supported a similar move by the House of Representatives. At the same time, it awaits action in the senate. Florida has also imposed a one-month stay that comes into effect in October after the tourist season gets over.
The federal efforts face criticism as both parties in the Congress are skeptical need approval there.
According to Californian Democrat Jared Huffman, gas stations and oil companies rarely benefit from price cuts to customers. California Policymakers are looking at ways to offer rebate programs to circumvent the problem and ensure that savings are passed to the consumers.
According to auto club AAA, the average price of unleaded gasoline was $4.32 a gallon on Sunday. The drivers in the U.S. currently pay 57 cents a gallon in state and federal taxes, as per the American Petroleum Institute.
Last month legislation was introduced by Senator Raphael Warnock, Democrat from Georgia, and co-sponsored by other Democratic Senators that would allow suspension of 18.4 cents of federal tax on gasoline until January 1, 2023.
The Press Secretary of White House, Jen Psaki, said that President Biden would continue to monitor and take steps to address prices of gasoline which are expected to continue rising as per the administration.
Democratic Governors in Wisconsin, Michigan, Minnesota, New Mexico, and Pennsylvania had sent a letter last week to congressional leaders asking them to suspend Federal taxes on the gas till the end of 2022.
In an event in Denver on Friday, one of the concerns of Janet Yellen, the Treasury secretary, is that the administration is looking at how to relieve consumers from the gas tax as there is a concern that cutting taxes would end up benefitting oil companies, especially when supplies are tight.
Motorists in California pay the highest tax of 86.66 cents per gallon, including the state excise tax of 51.1 cents and 17.05 cents in other state taxes per gallon. Till last year, some lawmakers were proposing to increase the federal gas tax to help overcome the deficit in the federal highway funding to the tune of $ 13 billion before the $550 infrastructure bill was passed by Congress.
