Georgia drivers were in for a state-ordered gas tax hike July 1, but after an order from Gov. Nathan Deal Friday, that won't happen now.
High gas prices may be falling, but they've still hit hard, Deal said, and drivers can use a break.
Motorists who would have paid an extra 1.6 cents per gallon starting next month will keep paying the same state gas tax, which is 20.4 cents per gallon. It was scheduled to rise July 1 to 22 cents per gallon, according to state Department of Revenue documents.
The freeze will end Dec. 31, and legislative approval for it will be required. According to Deal's office, the governor can suspend collection of the extra tax, but it's up to the Legislature to come back and change the law so that no one owes it. House Speaker David Ralston "strongly" supports the move, said Marshall Guest, a spokesman for the speaker.
Driver Willona Barksdale of Doraville said she was enjoying the drop in gas prices. She knew about the scheduled increase at the end of next week, and was dreading it.
“I’m more than happy," Barksdale said Friday. "I’m ecstatic. I’ve been waiting for gas prices to go down and then it goes up?”
Even though the savings to her will be relatively small, “everything helps,” she said.
On the other hand, Tony Marzullo of Sandy Springs said he thinks the gas tax should have been allowed to go up. The pennies saved by consumers like him aren't worth the lost funding for “better roads, better bridges, more jobs," he said. "Roads and bridges create jobs.”
The aborted gas tax increase was on top of another increase that went into effect less than two months ago, May 1.
“The escalating costs in 2011 have hit Georgians hard," Deal said in a statement. "Over the next few months, I think gas prices will continue to come down, and the May 1 rate will better reflect gas prices throughout Georgia. With this executive order, we’re making sure that Georgia’s families and businesses will keep an additional $40 million in their pockets over the coming months.”
Former Gov. Sonny Perdue did the same thing in 2008, and in 2005, after Hurricane Katrina, Perdue suspended the state gas tax entirely for about a month.
The part of the gas tax affected by Deal's decision is adjusted twice a year to match inflation. But in the meantime if gas prices soar 25 percent or more before the next scheduled increase, the state institutes an extra gas tax hike. That's what happened May 1.
Then the state prepared for the next scheduled change, July 1, by deciding on another hike. But since that decision gas prices in Georgia have fallen by 11 cents, according to AAA Auto Club South. In the metro Atlanta area, gas is now $3.56 per gallon, where it was $3.68 per gallon on May 31, wrote club spokeswoman Jessica Brady.
A spokesman for the state Department of Transportation, which may lose out on about $30 million it could have received, backed the governor. He wrote in an email that the most important thing was to continue what economic growth there has been.
"If this helps do that and encourages more people to follow through with their summer vacation travel plans, it will be well worth it," wrote the spokesman, David Spear.
The expected loss of funding for Georgia DOT will be a drop in the bucket of a general crisis for funding roads in Georgia and nationwide. Other state and federal gas taxes don't rise unless lawmakers vote to raise them, which they rarely do.
That means the cost of road construction keeps going up, but the money to pay for it doesn't. Congress has not raised the federal gas tax of 18.4 cents per gallon since 1993. Part of the Georgia gas tax does not rise with inflation, but is always charged at 7.5 cents per gallon.
In addition, people are driving cars with better mileage, which also reduces the amount of gas tax they pay.
Another factor helping push down gas prices lately is that the U.S. and other countries decided Thursday to release 60 million barrels of oil from reserves, to help fill the gap in supply left by disruption in Libya.
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