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Gas Taxation Pauses?

As gas prices continue to soar at record levels, state legislators all over the nation are considering implementing a pause on gas taxation. This is currently a bipartisan effort that aims at putting more money in American pockets, as paying at the pump is burdening families all across the nation.

This Judicial push at the state level can be seen as an effort by local governments to stop the rising fuel prices from hurting the economy and putting a hole in commuters’ wallets. So far the efforts to keep prices down have been fairly insufficient and that’s why the pause on gas taxation may have to be implemented.

Prices on the Rise

 

In just one week, the average price for a gallon of gasoline rose by 26 cents. In the last year, we have seen a dramatic $1.47 increase in the price of a gallon. It is without question that policymakers within their respective state want to assist their people in alleviating some financial pain at the gas pump, but many experts say this will only make a small dent in lowering fuel costs.

State Level Implications

 

Some states are hesitant to pull the trigger on this move, as suspending or ending the gas tax in any state would cost it hundreds of millions of tax dollars. But most states find themselves in a very unique situation. States are unusually wealthier, as a result of federal stimulus aid from the pandemic and the rejuvenation of state economies as more people return to working and spending more money.

Pioneering States

 

Some states are already working on fast-tracking this bill through congress. Maryland, whose gas tax sits at 36 cents per gallon, has introduced a bill to suspend the taxation for 30 days. The bill is expected to make it to the governor by next week. Georgia, whose house of reps are usually divided on everything came together to suspend its state gas tax until May. Florida also voted to suspend the taxation, but not until October. This is because Florida tourism is at its lowest point during that time of year.

Proposals have also been flying around in the States of Ohio, New York, Rhode Island, New Jersey, and Pennsylvania. In recent days, legislation is being introduced to these states, and the governors of these states are calling on congressional members to implement this suspension.

Wrap-Up

 

This can be viewed as good news for many Americans, but it is unknown if this tax break would help, as economists believe other factors are coming into play, such as demand for gas and global instability. This will still allow some Americans to save a little amount at the pump. Check with your accountant or advisor to find out if this tax break will be implemented in your state.

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