Vermont fuel taxes on the rise

By Keith Goble, Land Line state legislative editor | 4/30/2013

The cost of fuel in Vermont is on the way up.

Gov. Peter Shumlin signed into law on Monday, April 29, a transportation budget bill to raise about $630 million a year. The plan includes increases to the state’s fuel tax rates.

The state excise tax now is 19 cents per gallon on gas purchases and 29 cents on diesel.

Starting Wednesday, May 1, the gas tax will increase 5.9 cents per gallon. A 2 percent sales tax will be added to the cost of gas, while the per-gallon tax drops by about a penny. The change was made to address declining gas sales that result in fewer dollars available for road and bridge work.

The diesel tax is scheduled to increase 2 cents on July 1. The diesel rate will increase another penny in one year.

House and Senate lawmakers reached an agreement on the tax increases after initially disagreeing on whether to charge more tax on truckers. They also opted against tying the tax rates to the Consumer Price Index, which would allow for regular increases.

Sen. Dick Mazza, D-Grand Isle, said the diesel tax increase was needed to avoid tying the tax rates to inflation.

State lawmakers needed to reach agreement on the funding bill, H510, to avoid losing out on nearly $60 million in federal money for roads and bridges.

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