House Votes For Gas Tax Cut/Hike
The North Carolina House has voted for a slight drop—followed by a more substantial hike—for the state gas tax. Lawmakers have called the bill a stopgap.
When the Senate considered the legislation, sponsors called it a cut— even though, after a small initial drop, the bill is expected to raise the gas tax over the next few years.
House sponsor Bill Brawley was more direct.
“This is in response to a forecast that under the formula, the gas tax would drop to approximately 30 cents a gallon. The impact of a 7.4 cent reduction in gas tax on transportation revenues in North Carolina would be severe.”
The tax fluctuates based on the price of gas, but funds transportation projects across the state. The state could lose as much $400 million for transportation, when the tax is recalculated to match lower fuel prices, according to the North Carolina League of Municipalities.
So, the bill freezes the tax for the rest of the year at 36 cents—only 1.5 cents less than the current price.
That’s a change from the Senate version, which would have lowered the tax to 35 cents and required laying off 500 transportation employees. The House also stripped a Senate provision, which would have boosted revenue in later years, by changing how the tax is calculated.
Instead, Brawley says, they’ll need to find a more permanent fix, later this year.
The bill must receive one more vote in the House, scheduled for Thursday, before it goes back to the Senate.