OCEAN CITY— Marylanders could get some relief from soaring gas prices before the summer travel season kicks in, but it might take action from the General Assembly to make it happen.
With gas prices already soaring, Maryland’s gasoline tax is scheduled to bump up again this summer due to a scheduled hike linked to inflation and the Consumer Price Index (CPI). Under legislation passed by the General Assembly in 2013, the state’s comptroller each year announces gas tax increases that are set to take effect on July 1, based on national inflation rates.
This year, with the price per gallon of regular gas hitting $4.55 this week, that predetermined tax rate is set to increase on July 1 from around 36-cents per gallon to 43-cents per gallon, based on the 2013 legislation, which will drive the price up higher without some intervention by state elected officials.
Earlier this spring, the state implemented a gas tax holiday to give Marylanders some relief from rising prices at the pump, but that expired, and the cost of gas crept back up incrementally in the weeks that followed. Now, state lawmakers are considering a repeal of the scheduled hike in the gas tax, but it might take action from the General Assembly to make that a reality.
Earlier this week, Governor Larry Hogan wrote a letter to state Comptroller Peter Franchot calling on him to take action to halt the scheduled gas tax increase on July 1. There has been some question as to just who has authority to repeal the gas tax increase, but it appears there could be a special General Assembly session pending to address the issue.
In his letter to Franchot, Hogan urged the comptroller to use his discretion to repeal the pending increase, and perhaps reinstate the gas tax holiday with the summer travel season approaching.
“Given shaky oil markets, record inflation and a skyrocketing cost of living, the continued surges in gas prices are inflicting more pain at the pump than Marylanders can bear,” he said. “I am calling on you to take immediate action to provide much-needed relief, particularly as the citizens of our state begin to plan their summer travels.”
Hogan said in the letter the pending tax increase, on top of already soaring gas prices, is creating a hardship for Marylanders and could curtail summer travel plans and further impact the economy.
“This tax increase, while hardship-inducing for Marylanders at any time, is simply unconscionable at this moment when gas prices are at their highest level in recorded history amid a period of prolonged inflation and economic uncertainty,” he said in the letter. “I know that you agree we should do more to give Marylanders a break from these punishing prices. That is why it is my hope that you will use every legal and regulatory power at your disposal to halt or minimize the impact of accelerating gas taxes, and that you consider granting an extension for paying the taxes and removing penalties for unpaid tax, including the revocation of business licenses.”
For his part, Franchot did not disagree and urged the General Assembly to take action to repeal the pending gas tax increase slated for July 1.
“While there appears to be continued disagreement between the governor and my office, and the Attorney General’s interpretation of the law on whether or not I have existing authority to suspend the automatic increase to the gas tax set to go into effect on July 1, one thing is for certain,” he said. “The executive and legislative branches have unquestionable authority to prevent an 18% increase to the gas tax, from 36 cents to 43 cents, from taking effect. This amounts to a new, highly-regressive $200 million tax on Maryland families and small businesses.”
On Wednesday, the state’s Republican leadership called for a special General Assembly session to address the pending gas tax hike issue.
“Increasing taxes during a time of high inflation is an inherently flawed concept” said House Minority Leader Jason Buckel. “You are raising taxes at a time when Marylanders are paying higher prices for food, household items, energy and basically everything else. This is only going to hurt Marylanders. It is a self-inflicted wound to our economy.”
Buckel called into question the timing of the pending automatic gas tax hike increase.
“Now, we have the full picture of what this gas tax increase is going to be, and we know that gas prices are still historically high,” he said. “I hope our colleagues will see that this automatic tax increase cannot go forward.”
House Minority Whip Haven Shoemaker agreed, saying a decision on repealing the gas tax increase likely falls on the General Assembly.
“The bickering about whose job it is to fix this needs to stop,” said House Minority Whip Haven Shoemaker. “There is no question it is the job of the Maryland General Assembly to fix this law, we just have to have the guts to do it. It is also our job to reinstate a gas tax holiday to give Marylanders some relief. Our caucus tried to extend the gas tax holiday during the 2022 session, but there was not a willingness in the Democratic majority to do it. They said they had given Marylanders enough tax relief. Hopefully, they have time to reconsider and we can go to Annapolis and get this done.”