Senate Passes Bill Pausing the State Gas Tax

As gas prices continue to rise, Michigan lawmakers voted Tuesday to suspend the state’s gas tax for six months.

The rising gas prices we are seeing across the U.S. has been partially brought on by Russia’s invasion of Ukraine. War in Ukraine continues to rage on, the Ukrainian president even meeting with Congress Wednesday to ask for more aid.

The legislature wants to find a way to help Michiganders at the pump.Gas Tax Pause Pkg 3 15 2200 00 47 10still001

Right now, the federal gas tax rate is 18.4 cents per gallon and 24.4 cents per gallon of diesel. Governor Whitmer has already called on the Biden Administration to pause this tax.

Michiganders also pay 27.2 cents a gallon of gas and diesel in state gas taxes. Michigan lawmakers voted Tuesday to suspend that gas tax for six months and potentially save drivers $725 million.

Whitmer has hinted that she will veto any sort of measure, and now she gets a chance because the bill is heading to her desk

“If it’s important enough to ask the feds to do it, then it must be important enough to do it here,” said Senate Majority Leader Mike Shirkey.

Senate Democrats on the floor before the vote voiced a few issues, like dropping the tax doesn’t guarantee a price drop because companies can just continue to charge more.

“I would consider that price gouging,” said Sen. Jim Ananich, the minority leader. “It’s against the law as it is and I think our attorney general would go after people if they didn’t.”

Republicans say they can backfill the $750 million lost in gas tax with surplus general funds. The Dems are suspicious.

“We could’ve done it today, if we were going to do that,” said Ananich, “But we didn’t, so it wasn’t in the bill.”

Despite the passing of a gas tax pause that looks dead on arrival, already the focus has shifted to the sales tax on gas.

“I don’t want to do a suspension on a sales tax, I want drive a stake into the heart of the sales tax on gas,” said Shirkey, “It’s just been a dumb tax from Day One.”

Both sides are very committed.

“We can keep our schools educating our children, we can make our roads improve and we can also get people relief,” said Ananich, “That’s what I’ll commit to.”

Being a percentage, the higher the price, the more in savings. The catch being, sales tax money goes to schools. The budget covers the temporary cut Ananich is calling for but Shirkey wants to make it permanent. They will figure out the school funding later.  

“We’re this close to having a great success and great policy for the citizens of Michigan,” said Shirkey, “I think it would be a failure if we only did a suspension of it.”